Basic Bank Accounts Campaign

Reported in the May 2009 issue of the Social Policy Bulletin was Citizens Advice’s response to the European Union Consultation on access to bank accounts. In the submission Citizens Advice drew attention to the issue that opening basic bank accounts can still prove problematic for many people, with bureaux dealing with approximately 4,000 such cases between April and December 2008.

They also highlighted other problems regularly reported by bureaux, such as problems proving identity and address when trying to open bank accounts and lack of access to basic bank accounts for people in debt or with un-discharged bankruptcies.

Such a lack of access to a basic bank account can:

• mean the un-banked face higher charges for cheque cashing and utility bills;
• result in the un-banked being unable to obtain competitive loans; insurance policies or enter into a mobile telephone contract;
• mean a lack of security in storing money, leaving the un-banked vulnerable to theft or loss;
• limit employment opportunities where employers require wages be paid into a bank account.

Although agreeing in principle with the Commission’s view that people should be guaranteed adequate access to a basic bank account Citizens Advice felt that such an obligation would only succeed if it were accompanied by a number of other measures to ensure that:

•  there is an adequate supply of basic bank accounts that are accessible to people in both rural and urban areas;
• more complex issues relating to the demand for basic banking facilities among those who are currently un-banked are addressed.
   

With evidence that all consumers are not currently receiving an adequate banking service CALC decided to investigate whether its own clients were experiencing difficulties in setting up, accessing and running basic bank accounts. The findings of the campaign, and any recommendations on what banks could be doing to make financial inclusion a reality for many of the most excluded groups, would then be sent to the local branches and Head Offices of a number of banking organisations.

To this end a Client Questionnaire was designed to ascertain:

• whether or not our clients had heard of basic bank accounts;
• whether or not they had a basic bank account;
• the ease with which these accounts were set up;
• what, if any, problems they have had running these accounts;
• if they had been declined an account, and if yes why their application was declined; 
• for those who have been declined a bank account what problems had this caused

To gather further information it was decided to undertake a Mystery Shopper exercise to determine how proactively basic bank accounts were publicised and marketed within the branches. This exercise is scheduled to take place during the next quarter.
 

For more information contact:

Mrs Amanda Leadbeater
Tel: 01332 228724,
Email: amanda.leadbeater@citizensadviceandlawcentre.org