Will I get credit if I switch current accounts?

Q I am shortly transferring my overdraft from Barclays to Alliance & Leicester. Is it worth keeping my Barclays current account open? I have been banking there for six years. If I were to apply for other loans - a new credit card or mortgage, for example - would the length of time I have had a bank account be relevant?

AM

A Yes, it would. All credit providers are interested in lending to people who will repay what they owe and try very hard to avoid consumers who might default on their loans. One way they evaluate this is by checking the potential 'stickiness' of borrowers - how long they have lived at their current address, how long they have been with their current bank, and so on.

Generally speaking, the longer your tenure - whether at your home or with your bank - the more attractive a customer you will be to the lender. This is somewhat unfair, as it does mean consumers have to constantly weigh up the relative pros and cons of achieving a nice long record with an institution against the level of service it provides. It certainly isn't an encouragement to change your bank account.

And this issue crops up even if you're not switching banks. If you moved your account from the branch where you opened it to one nearer your current address, for example, you would no longer be able to claim a six-year history on the account.

Keeping your Barclays account open means you will be able to say truthfully that you have had the account for six years, but if you don't actually use the account - ie pay money in now and then - it will become dormant. If you continued to pay bills by direct debit through your Barclays account, you'd have to pay in a set amount each month to cover those costs, and the account would remain active.