Source · Select Committees · Treasury Committee
Recommendation 11
11
Accepted
Paragraph: 77
SME bank account closures for 'risk appetite' reasons lack transparency and consistency
Conclusion
Any SME with a legal business should be able to access a bank account. Banks may need to close business accounts because of regulatory requirements and concerns around financial crime, but thousands of accounts are being closed for vaguely defined reasons relating to “risk appetite” or “reputational risk”. What qualifies for this type of account closure varies from bank to bank with little regulatory guidance. SMEs deserve to know why their account has been closed, and the lack of transparency, alongside inconsistency in how criteria are being applied, is unacceptable.
Government response summary AI-generated
The government agrees that account closure requirements need improving and intends to bring forward legislation to ensure customers receive detailed explanations and longer notice periods when accounts are closed, except in financial crime situations.
Summary of the government's response below — read the verbatim text to verify.
Paragraph Reference:
77
Government Response
Accepted
HM Government · verbatim extract
Accepted
19. Banking services fulfil a vital role in the lives of millions of people and businesses across the UK, and the Government is committed to ensuring high standards of protection and financial inclusion across the financial services sector.
Read the full response on Parliament ↗