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Risk of Being Debanked/ Business Bank Accounts

DRD

DRD

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Joined
Oct 26, 2014
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5,434
Location
Newark
When you do your accountancy exams you are taught to spot/ mitigate business risks. ie computer storage burns down, sole supplier of xxxx screws you, your major debtor goes bust...... For many people/ small businesses we face a huge sole supplier risk with banks. Up until recently few had experienced the rapid removal of bank accounts. Most have held accounts with the same bank for decades.

Given the de-banking scandal and all the associated implications of finding you/ your business without a bank account with a few weeks notice, I have opened a second/ backup business account with Starling. I will put a decent chunk of my business through it.

Following a recommendation by a small business accountant we know, 'er indoors has been with Starling for a year. It has been faultless and as she is not a borrower it has been free. She works in the third world and gets real time exchange rate info on card transactions which can be quite handy.

My limited company business account was opened in less than 24 hours. It was all handled from my office chair by my mobile phone and its inbuilt camera. Scans of passport/ proof of whatever-copy leases-copy deeds, video of yourself to prove the passport is kosher. Took maybe 30 minutes total.

Worth consideration.

www.theguardian.com

UK banks are closing more than 1,000 accounts every day

Nigel Farage calls for royal commission as data shows big jump in customers being ‘debanked’
www.theguardian.com www.theguardian.com

www.bbc.co.uk

Nigel Farage launches website over de-banking 'scandal'

It comes after two banking bosses quit over the row about the closure of Mr Farage's Coutts account.
www.bbc.co.uk

www.thisismoney.co.uk

Community choirs, parish councils and clubs see Barclays accounts shut

Some of the groups have been with Barclays for decades - but have found their accounts closed or restricted after 'know your customer' checks, This is Money can reveal.
www.thisismoney.co.uk www.thisismoney.co.uk
 
Have had a Starling Business account since 2018, they're fine :)
 
Farage is a workie ticket out for himself and only himself. That said the way the banks operate needs to be questioned but not by someone like Farage who is unaccountable and out for personal publicity.

David
 
The mess the high street banks are making of the KYC process is entirely unrelated to the Farage nonsense and I have no sympathy for him whatsoever. (It's his bed to lie in imo)
But indeed high street banks also don't really seem to want to lend to small businesses either . In short they don't seem to want to be 'banks' anymore and either can't see or don't care that this business will all be taken away by online platforms and peer to peer lending . Weird .
 
Online banks will be driven by the same mindset as High Street banks however at present they are trying to increase market share by being helpful and nice. How long they stay being nice is unknown but don't think that any bank is looking after you, they are looking at the bottom line.

Now being nice can reap benefits but may well cost more so it depends on the bank respecting the customers and gain respect from those customers. Modern business models do not show respect for loyalty etc. so walk away from those banks.

David
 
Me and the misses wanted to open new accounts with a well known high street lender in 2022 (Lets call them "Knat West" for the sake of anonymity).
Sent forms, filled in. Then had to visit a branch, with formal ID, which seemed to have different opening hours than were on their website.... needless to say they were closed.
Asked online about it and was told "nope - you HAVE to follow this proceedure".

Asked about and whilst i had heard of Starling because of multiple trips abroad over the last few years...... i hadnt considered them.

Applied online. KYC done and accounts created within 24 hours. Cards arrived in the post within a couple of days.
Because of the pain, Knat West lost a long standing customer of over 20 years with multiple accounts (misses cancelled the lot!), and a potential new one, for no-one's fault other than their own.

Karma.
 
The underlying issue here is that in the UK you have no legal right to a bank account. Before the Royal Mail was privatised, you did have that right. We no longer do

If yours gets cancelled - how do you get paid, how do you pay the mortgage?, insurance?, credit card ? .... then your credit rating gets trashed. The whole thing could implode very quickly.

Hence the importance of this issue. Whatever he has done in his life, Farage has done a major public service with this one.

After he blew the whistle all manner of folk - politicians, family members of politicians, priests, charities .... all came forward to reveal the seriousness of this matter.
 
Charities have not been 'debanked' for the same reason that Farage had his account closed . It's not right to connect the two imo
The KYC debacle is incompetence on the banks' part, not a decision to deny accounts to people because of their opinions, beliefs, or indeed their actions. Two different issues entirely
 
This vicar was debanked 4 days after sharing his personal opinions in response to the Yorkshire Building Society's request for his feedback.

www.thetimes.co.uk

Yorkshire Building Society ‘closed vicar’s account after trans protest’

An Anglican church leader has accused the Yorkshire Building Society of bullying after it announced that it was closing his account within 14 days when he prot
www.thetimes.co.uk www.thetimes.co.uk


www.dailymail.co.uk

Vicar slams building society for closing account over trans protest

Rev Richard Fothergill, 62, claims Yorkshire Building Society shut down his account after he accused them of promoting gender ideology during Pride month.
www.dailymail.co.uk www.dailymail.co.uk

Federation of Small Businesses has many examples

inews.co.uk

Banks must be reined in over 'thousands' of account closures, say business chiefs

The body representing UK small businesses says 'more and more' firms are having their banks accounts closed with little or no notice amid evidence that services are being removed for reasons such as having a 'Russian-sounding' name
inews.co.uk inews.co.uk
 
DRD said:
The underlying issue here is that in the UK you have no legal right to a bank account. Before the Royal Mail was privatised, you did have that right. We no longer do

If yours gets cancelled - how do you get paid, how do you pay the mortgage?, insurance?, credit card ? .... then your credit rating gets trashed. The whole thing could implode very quickly.

Hence the importance of this issue. Whatever he has done in his life, Farage has done a major public service with this one.

After he blew the whistle all manner of folk - politicians, family members of politicians, priests, charities .... all came forward to reveal the seriousness of this matter.
Click to expand...


The problem is the messenger I'd imagine.

Many people will dismiss or ignore advice/news/instruction to their own detriment, if they have a dislike for the person delivering it.

Of course it's not binary. It's entirely possible to dislike Farage and banks.

The Farage thing was a cancel culture issue as I remember it. I think the bloke is a bit of a tosspot, but I was always under the impression that one was allowed to be a twat and still have a bank account. It's certainly permissible to have a driving licence and be an idiot which is far more concerning.
 
That's exactly the same . The vicar has seemingly been debanked for his opinions or actions in sharing them . Which I understand people are concerned about . The other article refers to closures for ML checks / regulatory reasons relating to sanctions etc . It's a completely different issue and I just don't think it's helpful to make the number of issues in the former category seem higher by including the latter cases as if they were the same. Because there are an awful lot of the latter.
 
I’ve been with santander for over 20 years. i have a mortgage, savings account, current account. and i started a business 2017 and opened a business account with them.

2 years later they closed my business account with 3 mths notice. i struggled to open another but managed it within the 3 months.

complained to santander and they just told me they were within their rights gave no reason and pointed me to ombudsman.

A year or so later i saw santander had a new saving account paying a much better rate. Applied on-line, and account was opened and approved. I transferred a hefty sum from my other santander account to get the better interest .

A week later all access to all my account was blocked, took several phone calls to get back online. then i noticed the new savings account disappeared. lots more calls and found out they closed the account. won’t give a reason, rather than transferring the money back electronically, they sent a chq. which took 2 weeks to arrive. Another complaint which they rejected and again pointed me at the ombudsman.

whole same thing happened again last mth. saw a great rate with cahoot savings. opened account no probs (they’re part of santander). as soon as i put in a few £k they closed it. again 2 weeks for a chq and no explanation. Raised a complaint with them, immediately closed and again go to ombudsman (which I will this time)

Over all this time period (last 3 years) i’ve been “persecuted” repeatedly by their KYC team, who struggle to know me at all, they don’t understand where my wealth and income comes from despite me repeatedly providing them all the written documents they keep asking for. They are absolute ****e.

just gathering all of this together for a big complaint to the ombudsman.

Meanwhile the real criminals are dining out with their bank managers ffs world gone mad.
 
Banks can be assholes. The same way that any large organisation can be. It’s all faceless.

There is a need for a basic banking system for everyone. Doesn’t need to be fancy but it’s impossible to live without one.

I had a student who stupidly let her brother’s mate pay in 5k and then he took it out in cash. Obviously it was crime related but at 17 you’re not as worldly wise as you should be.
Net result scumbag boy got away with it. She had her bank account closed and no other bank will touch her.
She’s since had to drop out of uni as can’t have a student loan paid in anywhere.
Wasn’t able to work as they can’t pay her in cash. In short she’s ****ed due to a stupid naive mistake.

I intensely dislike N.F. But even a man who gets less votes than a man dressed as a dolphin deserves a bank account (as indeed he was offered. It just wasn’t coutts)
 
johnwhitfield said:
Banks can be assholes. The same way that any large organisation can be. It’s all faceless.

There is a need for a basic banking system for everyone. Doesn’t need to be fancy but it’s impossible to live without one.

I had a student who stupidly let her brother’s mate pay in 5k and then he took it out in cash. Obviously it was crime related but at 17 you’re not as worldly wise as you should be.
Net result scumbag boy got away with it. She had her bank account closed and no other bank will touch her.
She’s since had to drop out of uni as can’t have a student loan paid in anywhere.
Wasn’t able to work as they can’t pay her in cash. In short she’s ****ed due to a stupid naive mistake.

I intensely dislike N.F. But even a man who gets less votes than a man dressed as a dolphin deserves a bank account (as indeed he was offered. It just wasn’t coutts)
Click to expand...
That's an awful story and we really could do with common sense to prevail in circumstances like this . We all make mistakes
 
AlanJ said:
just gathering all of this together for a big complaint to the ombudsman.
Click to expand...
Ahh.. would this be the same Santander that agreed a mortgage for me a couple of years ago and then 1 WEEK beforehand changed their minds because of a £7 a month "ground rent" that had been declared clearly to them 4 months beforehand???
This left us at the last minute scramblnig about to get a deal, and ended up renewing where we were as that was the only option (at our cost because the rates were worse by then.

I hope you screw them to the wall Col... I will never bank with them again.
 
Just mentioned this to my wife (Starling) and she went on about how a Welsh women who started it years ago etc etc and it’s the only online bank she would move too.
She was a bank manager at Lloyds where we still bank at, never had any problems with them having personal, business and mortgage accounts.

What rhymes with bankers😁
 
johnwhitfield said:
Banks can be assholes. The same way that any large organisation can be. It’s all faceless.

There is a need for a basic banking system for everyone. Doesn’t need to be fancy but it’s impossible to live without one.

I had a student who stupidly let her brother’s mate pay in 5k and then he took it out in cash. Obviously it was crime related but at 17 you’re not as worldly wise as you should be.
Net result scumbag boy got away with it. She had her bank account closed and no other bank will touch her.
She’s since had to drop out of uni as can’t have a student loan paid in anywhere.
Wasn’t able to work as they can’t pay her in cash. In short she’s ****ed due to a stupid naive mistake.

I intensely dislike N.F. But even a man who gets less votes than a man dressed as a dolphin deserves a bank account (as indeed he was offered. It just wasn’t coutts)
Click to expand...

This sort of real life story about decent young people just trying to get on in life really upsets me.

What is the point of all this bank fat cat internal looking protection if you are shafting people at the start of their adult lives and forcing them down the criminal/homeless route. What a disgrace banks are..

And ps, they have no problem holding cash for massive global crime organisations either... 'money laundering regulations', total bs, ****s... They just dont want everyone to have an equal chance...
 
Tucks said:
It's amazing to read on here peoples worry about being de-banked and at the same time having no sympathy for someone who has been de-banked, Farage.

If you live life like that you get what you deserve.
Click to expand...
Farage has done plenty of **** that means he gets no sympathy
 
Tucks said:
It's amazing to read on here peoples worry about being de-banked and at the same time having no sympathy for someone who has been de-banked, Farage.

If you live life like that you get what you deserve.
Click to expand...
As john said Nigel farage was not debanked . He was offered an account by the same organisation who closed his account . Are you really worried about him ? I'm not . There is not a single person in this country who has been denied the right to have a bank account (I.e. at all from anyone ) for their views . Nor is that going to happen . It's scare mongering to suggest otherwise
 
And I am worried about the poor teenage girl denied a bank account for life it seems for a teenage mistake . That's awful and I think requires some sort of legislation to stop it happening . Not sure why that would mean I should therefore worry about Nigel Farage though? He's ok I think ?
 
Tucks said:
It's amazing to read on here peoples worry about being de-banked and at the same time having no sympathy for someone who has been de-banked, Farage.

If you live life like that you get what you deserve.
Click to expand...

Some people will always stay blinkered to the truth.

I rest my case.
 
This isn't about Farage.

The point I'm making is that if you are happy to see some people de-banked and not others then you get what you deserve. I wouldn't want anyone de-banked whether I like them or not as it is impossible to live life without a bank account.
 
Tucks said:
This isn't about Farage.

The point I'm making is that if you are happy to see some people de-banked and not others then you get what you deserve. I wouldn't want anyone de-banked whether I like them or not as it is impossible to live life without a bank account.
Click to expand...
I'm not saying I don't mind him being debanked because I don't like him . I'm saying he hasn't been debanked (he's been deCouttsed)
 
In his information request from the bank stated they discussed at board level and ultimately closed his account due to his political views. Sounds like de-banking to me. He was turned down multiple accounts from various banks due to the ESG policies until he brought the issue to the public, pressured the government and set up website for others that had been de-banked. Only then did he get offered an account by HSBC.
 
The OP rightly talked about the issue one would have if no one would give you a bank account . I thought that's what you meant be debanking . Obviously not
 
What does it mean to be debanked?

Debanking is the process whereby a bank closes all a customer's accounts, such that the customer can no longer operate them. This can apply to both business and retail customers.

Think that covers it.
 
Whatever ones political standpoint, it's clear that the importance of a bank account has changed.

The phasing out of cash should really coincide with legislation ensuring everyone is entitled to a bank account . . . it's impossible to get by without one.
 
Gonzo said:
Whatever ones political standpoint, it's clear that the importance of a bank account has changed.

The phasing out of cash should really coincide with legislation ensuring everyone is entitled to a bank account . . . it's impossible to get by without one.
Click to expand...
I expect that is what will happen . Difficulty is the government have two choices . One is to force private organisations to take any customer whether they want them or not . Which is not really how the liberal deregulated uk is supposed to work and is more regulation not less when it's money laundering regulation that is causing the issue for far more people than it is any political matter . The other option is the government provide a default account . And who'd want an account that wouldn't work half the time with a 6 month waiting list to get your money out 😂
 
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