Government protects cash access services, free of charges, across the UK
New minimum expectation for cash-users set out by City Minister
Vulnerable cash users protected by Financial Conduct Authority (FCA)
A government statement published today sets out the minimum expectations on banks to protect services for people and businesses wanting to withdraw or deposit cash.
They can expect to withdraw cash without any fees – something that has been set out in law.
As part of this move, the Financial Conduct Authority (FCA) has been provided new powers by the government to protect the provision of cash access services. This includes protecting cash access without any fees for those who hold personal current accounts.
Building on laws granted through the government’s Financial Services and Markets Act 2023, the FCA will use these newfound powers to make sure banks and building societies are keeping up to these standards – and have the power to fine them if they do not.
While the country is moving further away from using coins and notes with the number of online payments rising from 45% to 85% in the past ten years, cash can still be an integral part of many businesses and people’s lives.
Economic Secretary to the Treasury, Andrew Griffith, said: “Whilst the growing choice and convenience of digital payments is great, cash has an important and continuing role to play.
“That’s why we are taking action to protect access to cash in law and laying out that this means fee-free withdrawals and the availability of cash facilities within a reasonable distance.
“People shouldn’t have to trek for hours to withdraw a tenner to put in someone’s birthday card – nor should businesses have to travel large distances to deposit cash takings.
“These are measures which benefit everyone who uses cash but particularly those living in rural areas, the elderly and those with disabilities.”
As it stands, the vast majority of people living in urban areas can access cash deposit and withdrawal services within one mile; with rural-dwellers around three miles away.
Today’s policy statement makes clear that the FCA should use its powers to maintain this level of coverage, while recognising that needs may differ by location and change over time.
It also makes clear that – if a service is withdrawn and a replacement service is needed – this should be put in place before the closure takes place.
The FCA is also required to ‘have regard’ to local deficiencies in cash access. The policy statement sets out that the regulator should consider factors such as the opening hours and distance to cash access services, as well as the need for in-person assistance.
Laws introduced in the Financial Services Act 2021 have delivered cashback in over 2,500 shops across the UK – without any need to buy something in store – through the LINK network.
Government intervention sees tens of thousands of Ukrainian refugees’ access banking services in the UK
Basic bank accounts offer fee-free accounts allowing users to send and receive money, helping people to build their lives here
News falls one-year since Russia’s illegal and barbaric invasion of Ukraine as UK government confirms its support will not waiver
TENS OF THOUSANDS of Ukrainian refugees have been able to access banking services in the UK thanks to government action, data released today shows.
Basic bank accounts, which the nine largest UK lenders have been required to provide since 2014, allow people with a limited credit history to access and carry out everyday banking, widening people’s access to the financial system and the wider economy. The accounts do not offer overdrafts, ensuring people do not get into unaffordable debt.
A year on since Putin’s barbaric invasion of Ukraine, the UK has granted more than 215,000 visas to refugees of the war, under our Homes for Ukraine and Ukraine Family Schemes
Following the invasion, the government brought together UK basic bank account providers, ensuring fast action was taken to remove the barriers to opening UK bank accounts faced by Ukrainian nationals, such as the lack of a conventional ID.
This has already helped more than 70,000 people to build their lives more easily in the UK by enabling them to receive their income, send money, and pay for goods.
Economic Secretary to the Treasury, Andrew Griffith said: “We will continue to help as many Ukrainian refugees as possible access the banking services they need to build a life here – and I’d like to thank UK banks and building societies for their support to date.
“A year on from the invasion, Putin should be left in no doubt that the West will not waiver in its support for Ukraine and its people.”
The UK government has been working with its international allies to punish Putin and his cronies for their illegal invasion of Ukraine, while supporting the Ukrainian people and its government.
This includes sanctioning more than 1,200 individuals and 120 entities, including striking the heart of the Kremlin by sanctioning Putin himself, along with his closest associates.
The UK has also committed £4.6 billion of military support by the end of 2023, supplying 10,000 anti-tank missiles, almost 200 armoured vehicles, 2,600 anti-structure munitions, and almost 100,000 rounds of artillery.
And we are also a leading bilateral humanitarian donor, having committed £220 million in assistance.
Lloyds Bank has appointed Jamie Kemp to the role of Invoice Finance Area Director for Scotland and the North East, as it strengthens its support for businesses across the region.
Jamie has over 11 years of experience in the finance sector, with experiencing spanning across retail, private and commercial banking. Over the last 4 years, Jamie has specialised in Invoice Finance and has been recognised by UK Finance as their Top Foundation and Certificate student.
In his latest role, Jamie held the title of Business Planning Manager for the Invoice & Asset Finance Sales division where he was responsible for overseeing and supporting national delivery and performance.
Jamie Kemp commented:“I am delighted to lead a team of highly experienced Invoice Finance professionals to deliver bespoke solutions for small to medium sized enterprises. The current climate is making the cost of operating more and more challenging for businesses.
“I’m looking forward to supporting those businesses based in the North East and Scotland through these challenging times as much as possible in my new role alongside my team.”
Ben Stephenson, the Head of Specialist Client Solutions at Lloyds Bank, added:“We are pleased to welcome Jamie into the role of Invoice Finance Area Director. He brings with him a wealth of banking and finance experience, which will stand him in good stead to excel in this role and provide exceptional service for our clients.”
While starting his new role, Jamie is also hiring for an Invoice Finance Field Sales position (Associate Director level) based in and around Glasgow. The role has been designed to attract enthusiastic and talented individuals which may be new to the Invoice Finance industry.
It offers a substantial period of training, supported by a comprehensive learning plan, which includes undertaking the Invoice Finance Foundation Course, UK Finance’s entry-level qualification. This should ensure that the successful candidate has the best possible start to a career in Invoice Finance.
World’s oldest remaining building society sees major growth in savings and mortgages
Scottish Building Society, the world’s oldest remaining building society, has posted record results for the financial year ended 31 January 2022.
Established in 1848, the mutual has seen its balance sheet grow by nearly 40% in the last 2 years, leading to a pre-tax profit of £2.4m and mortgage assets of £454m.
The Society, which only offers savings and mortgage accounts, ascribed the growth to customers seeking both value and purpose when joining SBS.
The Society’s Chief Executive, Paul Denton said: “We are as committed to our wider purpose today, as we were back in 1848. As a mutual society, we reward our members with fair interest rates whilst responsibly using those funds to provide flexible mortgages, enabling Scottish people to buy homes and get on the property ladder.
“The environment has changed over the years, but that simple strategy has helped the Society survive and thrive towards its 175th anniversary next year.”
As the society is a mutually owned organisation, it has been able to offer its members savings accounts above market average interest rates, helping people get the most out of their money.
Mr. Denton continued: “Despite the historic low base rate, we have continued to pay savings rates above the market average, whilst our income has benefitted by growing our mortgage balances more than 36% in the last two years.
“We are now helping more members buy their homes than ever before, which is something we are incredibly proud of in today’s fierce mortgage market.
“As a mutual, unlike the high street banks, we do not have shareholders, so all profits are reinvested into the business, in areas such as in new digital technologies, improving our member experience and increasing our capital base to support future growth.”
Mr. Denton credits the staff at SBS for their “immense work” during the pandemic as one of the reasons why the society has performed so strongly.
He explained: “It has been without doubt two enormously difficult years from an economic and operational perspective, but our staff have delivered outstanding results despite these major challenges.
“Unlike retail banks who are moving out of towns and cities across the country, we are working harder than ever to provide for our members- be that through online or in-person banking.
“When many of our competitors sought to save money by cutting services, we were looking for ways to help our members, by offering compelling interest rates for savers and have now helped a record number of people own their own home.”
For the first time since the financial crisis, NatWest Group plc (formerly Royal Bank of Scotland Group plc) is no longer under majority public ownership following a £1.2 billion sale of part of the government’s shareholding back to NatWest.
This is the government’s fifth sale of its NatWest shareholding bringing its level of ownership down from 50.6% to 48.1%. This is a landmark in the government’s plan to return to private ownership the institutions brought into public ownership as a result of the 2007-2008 financial crisis.
The Economic Secretary to the Treasury authorised the sale of approximately 550 million shares in NatWest at 220.5p per share raising a total of £1.2 billion. The shares were bought back by NatWest and the process was managed by UK Government Investments.
The Economic Secretary to the Treasury, John Glen said: “This sale means that the government is no longer the majority owner of NatWest Group and is therefore an important landmark in our plan to return the bank to the private sector.
“We will continue to prioritise delivering value for money for the taxpayer as we take forward this plan.”
NatWest chief Alison Rose said the share buyback is an “important milestone” for the bank.
Ms. Rose said: “The deal is a good use of capital for the bank and our shareholders. Reducing government ownership below 50% is an important milestone for NatWest Group and a further demonstration of the progress we are making as we continue to deliver for our customers and shareholders.”
Some banks can and should be doing more to protect their customers from criminals trying to steal sensitive information, Which? research has found.
With the last year seeing an increase in scams, many consumers will expect that the companies they deal with in their everyday lives are doing everything they can to protect them.
However, a new Which? investigation has found that some banks are failing to use all the tools available to them to combat scammers, leaving weaknesses in their security systems that scammers could exploit.
The consumer champion looked into what protections banks were putting in place to protect their customers from receiving fraudulent emails, SMS messages and phone calls.
These so-called phishing attacks are worryingly common. Scammers send legitimate-looking messages that are designed to tempt people into divulging sensitive information, such as bank account details, usernames or passwords.
Phishing scams may try to imitate (or ‘spoof’) banks’ genuine email addresses or domains, sometimes by making slight changes – for instance, by changing ‘.co.uk’ to ‘.com’.
Banks should be implementing a system that protects web addresses they own or use – known as ‘domain-based message authentication, reporting and conformance’ (DMARC) – to prevent spoofing attacks.
Banks can use DMARC to tell email providers how to handle the unauthorised use of their domains.
The process of introducing DMARC is frequently done gradually: by initially setting records to ‘none’ (a monitoring phase where no action is taken if DMARC checks fail) before working towards ‘quarantine’ (which moves emails to junk/spam if they fail the checks) and ultimately, a policy of ‘reject’ (which blocks all emails that fail the checks).
When Which? asked security experts at technology company 6point6 in April to check whether banks offered this protection, some banks were falling short.
At the time of the investigation, the Bank of Ireland and Agricultural Mortgage Corporation – a wholly owned subsidiary of Lloyds Banking Group – had not yet introduced DMARC.
This could have allowed scammers to forge their email address and send messages that would appear indistinguishable from genuine ones from their bank. Both have since taken action to resolve this.
The investigation also found that Nationwide, TSB and Virgin Money – nationwide.co.uk, tsb.co.uk and virginmoney.com, respectively – had not set their policies to ‘reject’ all emails that fail DMARC checks. TSB and Virgin Money told the consumer champion that they are working towards this.
Nationwide said it has security features to protect against spoofing and will ‘look at ways to improve email security, including future enhancements to DMARC security.’
The investigation also uncovered that The Co-operative Bank, First Direct, Starling and Tesco Bank had no DMARC system in place for their alternative domains, but did for their primary domains.
Although The Co-operative Bank has protected its ‘co-operativebank.co.uk’ email address, there are no DMARC records for ‘co-operative.co.uk’ and ‘coop.co.uk’ – two domains that are owned by The Co-operative Group, a separate company not associated with the bank – making them vulnerable to scammers who could pose as The Co-operative Bank using alternative email addresses.
Since the investigation, Starling and Tesco Bank have now applied DMARC to alternative domains, starlingbank.co.uk and tescobank.co.uk, respectively.
First Direct and The Co-operative Bank told Which? they are reviewing the inclusion of their alternative domains – firstdirect.co.uk and co-operativebank.com – within their existing DMARC policies.
While banks are further ahead than other industries when it comes to implementing DMARC, Which? believes that it is often too hard for customers to tell the difference between a phishing email and genuine communication from banks due to inconsistent practices across the industry.
This is particularly concerning amid a worrying culture of banks blaming victims for falling for scammers’ tricks, despite their heightened sophistication. This means people often face a lottery to get their money reimbursed under the industry’s voluntary bank transfer scams code.
Which? is calling for all banks to implement DMARC and configure it correctly, setting their policies to ‘reject’, meaning email providers should block any emails that fail these checks.
Banks should also be clamping down on number spoofing, which involves scammers manipulating caller IDs to mimic the phone numbers of legitimate organisations. To tackle this, Ofcom worked with the banking industry body UK Finance to identify a list of ‘do not originate’ (DNO) numbers – numbers that are never used for outbound calls.
Most banks had signed up to the scheme at the time of the investigation, apart from The Co-operative Bank and Nationwide – although both have since told Which? they plan to join.
Banks can also protect their SMS headers – the name or number a text message appears to come from – against spoofing by registering with the SMS SenderID Protection Registry run by the Mobile Ecosystem Forum.
The consumer champion believes that if banks did not include weblinks or phone numbers in their official SMS communications – sensitive information that is prone to spoofing – consumers could feel more secure and be able to spot scams more easily.
Which? is working on a best practice guide for businesses to help raise standards of SMS communications and bring greater consistency to how they protect consumers.
Jenny Ross, Which? Money Editor, said: “It has never been harder for people to know whether they’re receiving genuine communications from their bank, or being tricked – so it is crucial that banks take every measure to protect their customers from these devastating scams.
“These include implementing email scam protections properly and no longer putting phone numbers and links in messages, to ensure customers feel safe and can bank with confidence.”
Santander has apologised to customers for a ‘techinal problem’ which saw customers unable to pay bills or access cash yesterday. The problem has now been resolved and the bank says some branches will open today.
In a statement issued last night Santander said: “All of our banking services are now working as normal.
“We are very sorry for the inconvenience you’ve experienced today. If you need help, some of our branches will be open on Sunday from 10am to 12pm. We’ll publish a list of these tomorrow.”
The bank has yet to fully explain the cause of the problem.
Gareth Shaw, Head of Money at Which?, said:“These technical issues will be causing stress for many Santander customers – with people reporting that they have been unable to make online payments or in some cases purchase food in their local supermarket.
“Customers can incur fines, penalties and fees when they’re not able to access their finances, so the bank must offer compensation to all those who have been impacted in this way.
“These problems demonstrate why it is vital that banks invest to ensure their systems are up to the task of protecting their customers’ accounts and maintaining the services they rely on.”
Today we launch our 2020 Social Impact Report, it shows how charities and social enterprises are using our loans to make a difference to the world around them.
The aim of Charity Bank is to leave these organisations in a stronger position, both financially, and in terms of their ability to carry out their mission.
Last year, 67 borrowers used a new Charity Bank loan to support their mission. Some used their loan to expand services and reach more people. Others used it to improve their financial stability by reducing their reliance on grant funding, increasing their assets or cutting their outgoings, putting them in a stronger position to help local communities for many years to come.
We invite you to look inside our report and find out more.
The banking industry is taking an inconsistent and confusing approach when dealing with refund claims for customers who have reached a stalemate with a business over refunds for coronavirus cancellations, new Which? research has revealed.
With huge numbers of consumers deeply dissatisfied with travel companies and other businesses asking them to accept credit notes or rebooking instead of offering refunds, Which? has heard reports from frustrated bank customers who have had claims turned down.
This includes one customer who was denied a refund of a £2,200 payment split between Halifax and Metro Bank cards for a cancelled ski trip and another left £750 out of pocket after RBS rejected her claim. In both cases the customers were told a refund was not possible because they were being offered credit notes or vouchers.
The cases prompted the consumer champion to investigate how banks are handling claims under two forms of consumer protection.
The first of these protections is chargeback, which covers all card payments. While not a direct consumer right, it is a process provided under card schemes which reverses a transaction if a customer is not able to resolve a dispute with a business for a variety of reasons.
The second is Section 75 of the Consumer Credit Act 1974, a legal protection for credit card users on purchases of more than £100 and less than £30,000, which gives the customer a claim against the card issuer as well as the retailer or trader for the goods or service supplied.
Despite guidance issued by Mastercard and Visa stating that customers are able to pursue the chargeback route if they are offered a voucher or the option to rebook, when Which? asked banks to confirm if they would attempt to process refunds, MANY STATED THAT CLAIMS WOULD NEED TO BE HANDLED ON A CASE BY CASE BASIS. The same applied to Section 75.
Which? is concerned that a failure to provide even general information about the circumstances where a claim could be successful risks leaving consumers unaware of vital consumer protections that could help them get their money back at a time when people’s finances are significantly stretched.
However, some banks did provide clearer information about the prospects of consumers getting their money back. In relation to chargebacks, Virgin Money (Mastercard) made it clear that if the alternative arrangements are not covered in the terms and conditions, they would normally expect a chargeback to be successful.
Starling Bank (Mastercard) and Lloyds Banking Group (Mastercard and Visa) said that they will initiate a chargeback where the offer of vouchers or free rebooking is not deemed suitable by the customer.
But Which? has also heard from a Halifax customer who was turned down for a chargeback request for a cancelled holiday based on these circumstances, despite the bank being part of Lloyds Banking Group – raising fears that the rules are not being applied evenly.
The number of people using the free Which? chargeback and Section 75 tool has shot up to 10,000 in March and April so far, compared to 1,000 in January and February of this year.
This highlights how many people are getting nowhere with businesses on refunds, often in cases where a significant amount of money is on the line. Amid confusion over the protections the banks offer in these circumstances, Which? is calling for the industry to be more upfront about the situations where chargeback and Section 75 are likely to be appropriate for consumers in relation to coronavirus-related cancellations. It believes banks should follow the lead of those in the industry who have committed to providing customers with the best prospect of getting their money back.
Gareth Shaw, Head of Money at Which?, said: “While it is a very difficult time for businesses, the coronavirus outbreak has also put people’s finances under considerable pressure, and they deserve to get their money back if they want a refund for a cancelled event or trip, rather than a voucher or the option to rebook.
“However, there is clearly confusion about the circumstances which allow banks to help their customers achieve this. There needs to be greater clarity and consistency about claiming through banks, and the industry should ensure that all bank customers have a fair chance of getting their money back.”
Which? is concerned by early signs that some of Britain’s biggest banks are refusing to reimburse blameless victims of devastating transfer fraud, despite the introduction of new industry standards intended to protect fraud victims.
Banking customers lose life-changing sums every day through bank transfer scams – with Which? even hearing from a victim who lost £500,000 through his restaurant business.
It was hoped that the introduction of a voluntary industry code in May 2019 would ensure that all blameless victims get their money back, finally reversing the trend of people being left out of pocket.
But Which? has heard from a number of people who say they have been denied reimbursement unfairly – with a worrying trend emerging of banks relying on fraud warnings to justify not refunding customers. These decisions from banks fly in the face of the voluntary code most banks have signed up to, which pledges to reimburse all blameless victims.
It is now much more common for online or mobile banking customers to see fraud warnings when transferring money, as banks seek to meet new code standards by introducing a range of different features aimed at making a customer think twice about whether they are being scammed.
However, a Which? survey found that almost half (49%) of people are not even aware that new fraud warnings had been introduced by banks – further evidence that victims should not be arbitrarily turned down for reimbursement because they have “ignored warnings”.
Case study – Michelle, 38, London
Which? spoke to Michelle, 38, who lost almost £33,000 after responding to a text message about a ‘suspicious payment to Airbnb’ in August 2019. It appeared to come from Lloyds Bank’s usual phone number, sandwiched between two genuine messages, so she called the number supplied. Over the course of an hour Michelle was persuaded to transfer her money to a new account, in the belief that hers had been hijacked by criminals.
Lloyds says although it has sympathy for Michelle it will not reimburse her, on the grounds that she ‘did not take sufficient steps to verify that either the text message or the person she spoke to on the phone were genuine’, and that she authorised the payments despite receiving ‘specific warnings’ stating that Lloyds would never ask a customer to move money to other banks.
Michelle had no reason to believe the text was fake, and Lloyds is yet to explain the ‘sufficient steps’ she ought to have taken. And, while she did notice an online warning about fraud when she made the first payment, the criminal on the phone was able to quickly dismiss her concerns.
She said: “It was very urgent and compelling. My two-year-old daughter was running around while I was on the phone to them for an hour. I saw the warning about Lloyds never asking me to move money into a safe account and flagged this over the phone. They assured me that these were not “safe” accounts but “new” accounts.”
Which? has advised Michelle to escalate her case to the Financial Ombudsman Service.
Which? – working with two leading academics – also analysed the effectiveness of banks’ fraud warnings, to establish whether they are adequately ‘understandable, clear, impactful, timely and specific’ – as set out in the code.
The experts raised concerns about elements of the warnings from some of Britain’s biggest banks.
One researcher voiced concerns over the ‘generic’ messages displayed by First Direct, HSBC, Lloyds, Natwest and Royal Bank of Scotland. Petko Kusev, from Huddersfield Business School, said that it was perfectly rational for customers to ignore generic information when conducting bank transfers.
A second researcher, Patrick Fagan from Goldsmiths University, suggested that some warnings can come too late, as once people have already been targeted by scammers they typically commit to seeing the action through. Mr Fagan suggested that banks use targeting and personalisation to make these warnings more persuasive.
Which? supports the introduction of fraud warnings as an important defence in preventing scams. However, Which? believes that banks must prove their fraud warnings are fit for purpose and should not be used as a means to simply deny reimbursing blameless victims. If a bank can’t prove its warnings are effective then the customer should not be deemed at fault.
The consumer champion also wants the industry code to be made mandatory for all current account providers as many providers still haven’t signed up to the vital fraud protections.
Jenny Ross, Which? Money Editor, said: “People are losing life-changing sums of money every day to devastating bank transfer fraud – so it’s shocking that some current account providers still haven’t signed up to offer their customers vital protections.
“All banks must prove that their online warnings are up to scratch – especially if they are denying victims reimbursement, as we’ve seen in some cases.”
The consumer champion put banks’ fraud warnings under the spotlight, and found:
Asking customers to tick a box to confirm they have understood the warning could prove more effective than warnings that take consent for granted.However, Which? believes this is still a low bar for establishing consent.
Nationwide’s ‘STOP AND THINK’ message ahead of a transfer was deemed to be effective at providing customers with concrete, clear imperatives.
Which? is critical of HSBC’s approach that gives customers the option of hiding warnings, raising the likelihood that customers might not see them at all.
Meanwhile, customers could easily miss important wording and rush through a transfer if it is towards the bottom of a screen, such as First Direct’s warning.
Banks that have not signed up to the code:
Bank of Ireland, Citibank, Clydesdale and Yorkshire Bank, Danske Bank, First Trust Bank, Monzo, N26, Tesco Bank, and Virgin Money. Although TSB is not a signatory of the code, it promises to reimburse all victims of fraud under its ‘Fraud Refund Guarantee’, launched on 14 April 2019.
The Lending Standards Board is responsible for overseeing the new voluntary code and assessing how firms are implementing the standards set out in the code.
