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Basic bank accounts 'should be easier to use, not harder'

Citizens Advice Scotland have called on the major High Street banks to increase access to basic bank accounts, after it emerged that some banks were restricting the numbers of ATMs that can be used by holders of such accounts.

Basic Bank Accounts are intended for people who have poor credit history, to enable them to manage their money. But a major report by CAS last year found that Scotland’s banks were not providing enough of these acounts, and now it has emerged that some are introducing ATM restrictions for their Basic Bank Account holders.

CAS Chief Executive Lucy McTernan said,

“The whole point of Basic Bank Accounts is that they tend to be used by people who are financially vulnerable. The principle behind them is that they should enable the person to manage their money in a straightforward and practical way.

“They should therefore be accessible and easy to use. We would be concerned about any attempts to contradict that principle, and to introduce obstacles that will complicate the account, and make it more difficult for the user.

“Last year CAS published evidence showing that banks were failing to provide access to basic bank accounts – despite government efforts to compel them to do so. We found that 1 in 10 people in Scotland don’t currently have a bank account, though two thirds of those had tried to open one, and been rejected by their bank.

“So we feel that banks should be concentrating on making these accounts more accessible, not on placing restrictions on those which do exist. We are continuing to monitor this issue carefully, and it features regularly in the discussions we have with MPs and MSPs.”

Last year CAS published a highly critical report, Banking on the Basics.

The main findings in the report were:

  • One in ten Scots do not have a bank account, although two thirds of people without an account have tried to open one.
  • The problem affects at least 5% of Scottish households, which is higher than the rate in the UK as a whole (3%).
  • In Scotland, 1 in 5 households in the 15% most deprived areas don’t have a bank acount.
  • Young people and those living in rural areas are among those worst affected.

The report can be accessed here.

For more details, interviews etc please contact Tony Hutson on 0131 550 1010. Or 07774 751655. NB This is the number of the CAS Press Office, for use by journalists only. If you are a member of the public looking for CAB advice please contact your local bureau.