BR Friendly Bank Accounts ~ [Updated Sep 2012 re: Co-op Cashminder withdrawal]

IF

AlexMetz wrote: »

Hi,

I am bankrupt and I have found it very hard to open a new bank account. I openend a savings account with natwest and I went into to see a advisro and I asked do you have any bank accounts that I can open while im bankrupt. They told me that they had a bank account called First Reserve - this is a savings account but you do get a visa debit card with it. The only problem is that you cannot use the account for DD or SO but if you open a savings account along side the First Reserve then you can use the savings account for DD and SO.

Hi AlexMetz, Is this account up and running now? and for how long have you been using it? This is unusual but not unheard of, some BR's are lucky and some have their accounts closed within weeks of use!!

If...x

fermi

http://nds.coi.gov.uk/content/detail.aspx?NewsAreaId=2&ReleaseID=422101&SubjectId=2

17 November 2011 11:29

Insolvency Service (National)





The Government would like to see improved access to bank accounts for undischarged bankrupts. Proposals have been published asking for evidence about the effect bankruptcy has on the ability of individuals to access a bank account and inviting views on possible measures to improve access.

Bankruptcy can be a fresh start for people who have got into an unmanageable debt situation but as a consequence it appears it may lead to difficulties getting a bank account, which hinders their financial rehabilitation.

Without access to a bank account, bankrupts may struggle with basic tasks such as receiving wages and paying bills and this can result in additional expenses for them.

Whilst there is no law that specifically prevents a bankrupt from holding a bank account, it is a decision for a bank whether to offer an account. A trustee can, in very limited circumstances, consider pursuing the bank for loss of money from the bank account following a bankruptcy. For this reason, most banks will not offer even a basic account to undischarged bankrupts.
Business Minister Edward Davey said:

“Access to a bank account is an essential stepping stone to help people manage their finances and to get them back on track after facing up to their financial difficulties. Without access to a bank account, even the simplest financial transaction is beyond reach for an undischarged bankrupt. What I want to see are financially capable consumers who are able to effectively manage their money, and make the fresh start they need.

“If evidence suggests that there are some people that are struggling to get a bank account, I want to see what can be done to help improve their circumstances.”

The purpose of the consultation is to gain information about the number of people affected, which will help inform whether or not formal intervention is needed to improve access to bank accounts for people who are bankrupt.

The possible courses of action include:

• Promote providers who currently provide access to bank accounts for undischarged bankrupts – currently two high street banks offer basic bank accounts to undischarged bankrupts.
• Establish a voluntary code for banks – Banks, building societies and other banking service providers already operate under a voluntary code of practice which covers certain products and services and encourages those organisations to provide clear information. The banks could sign up to a code to agree to provide accounts to undischarged bankrupts.
• Providing guidance for trustees in bankruptcy - drafting further detail about the circumstances in which a trustee should consider a claim against a bank and when they are unlikely to, the banks would have a clearer indication of the likely risk of a claim and perhaps be reassured that it would be unlikely
• Introduce legislative change - If non-statutory options seem unlikely to improve the situation, legislation could be amended to reduce or remove any potential liability on a bank.

The consultation seeks to gather evidence on the problem and to explore possible solutions. Interested parties should respond to the consultation on www.bis.gov.uk/insolvency/consultation

The consultation will close on 9 Feb 2012.

Notes to editors


1. The public consultation on Bank Accounts for Bankrupts is set to run for 12 weeks. The consultation seeks to gather evidence and offers a range of possible statutory and non statutory solutions. The consultation, Bank Accounts for Bankrupts can be found here www.bis.gov.uk/insolvency/consultation.

2. In England and Wales only two high street banks offer undischarged bankrupts access to a current account meaning that some are left without any access to a bank account, which forces them to operate on a cash basis for the duration of their bankruptcy. In July 2010 Citizens Advice published their report ‘Called to Account’ stating that the current situation was causing undischarged bankrupts undue hardship. As a financial inclusion issue, having to operate on a cash basis means that transactions are more expensive and more difficult for this group of people. Savings cannot be made by using direct debits or online prices and there can be transactional difficulties receiving wages and having to make all transactions during office hours.

3. The Insolvency Service administers the insolvency regime investigating all compulsory liquidations and individual insolvencies (bankruptcies and debt relief orders) through the Official Receiver to establish why they became insolvent. The Service also authorises and regulates the insolvency profession; deals with disqualification of directors in corporate failures; assesses and pays statutory entitlement to redundancy payments when an employer cannot or will not pay employees; provides banking and investment services for bankruptcy and liquidation estate funds; and advises ministers and other government departments on insolvency law and practice. Further information about the work of The Insolvency Service is available from http://www.bis.gov.uk/insolvency

unhappytinkerbell

Quick question regarding the Co-op and sorry if it sounds silly.. I get paid my salary on the 25th of every month and its always in my bank account that day, would this be the case with the Co-op, are salaries credited same day they are paid? Reason I ask is I have a basic Nationwide account also but money never seems to clear the day its sent to that account which is frustrating.

IF

unhappytinkerbell wrote: »

Quick question regarding the Co-op and sorry if it sounds silly.. I get paid my salary on the 25th of every month and its always in my bank account that day, would this be the case with the Co-op, are salaries credited same day they are paid? Reason I ask is I have a basic Nationwide account also but money never seems to clear the day its sent to that account which is frustrating.

Hope this thread helps and Andy’s link.

---

> http://forums.moneysavingexpert.com/showthread.php?t=3591907&highlight=

Andy’s useful link here with faster payment limits for different banks:-

--- > http://www.ukpayments.org.uk/faster_.../value_limits/


If...x

cashkid

I opened a co op account about three months before going bankrupt. Ironically my credit rating was too good for the cashminder at first but after bankruptcy the co-op kept my first account open and also were excellent and speedy at opening the new one and transferring my choice of direct debits to the new one. It was TOTALLY pain free and everyone I spoke to was helpful and really friendly.

:j

SteveABC

Don't know if this will be of any help to anyone. My (Halifax) bank account was frozen on the day of my BR. It had a balance of a couple of pounds in it at the time. Immediately after my BR, I left the court and went to my local Co op branch with my passport and driving licence for identity. The Co op were great. I simply explained my situation and they sorted out my cashminder account there and then. They were completely non judgmental and happy to help. Within a week the account was opened and I had my debit card. I quickly set up all my D/Ds and S/Os and arranged to have my salary paid in. I have access to internet banking, which I check daily to keep tabs on things.

For those in a similar circumstance, my experience of the Co op was a good one. That was nearly a year ago and I've had no problems at all and see no reason to ever change from the Co op in the future. They were there for me when I needed them and I now feel loyalty to them.

norman1976

I opened a barclays cash card account a few days after BR and account opened without any trouble. Barclays were very understanding so I recommend them if people having trouble opening accounts elsewhere.

leebaker317

Ive been discharged bankrupt for over 4 years, I have a coop cashminder account which serves its purpose but Id like to rebuild my credit with another high street bank.
Which banks have accounts for discharged bankrupts im not wanting any credit now but looking for the future.

Cheers

IF

Hi leebaker317, I know that some members have had luck with the Nationwide cash card + and the Natwest Step Account. Plus of course the Barclays Basic account you can then have online banking facilities.

Best wishes
If...x

nachtwatcher

From my own experience, I opened an account with Co-op before I went BR (and told them why)

I have a debit card, free cash points, etc... DD's, Standing Orders... pretty much everything I had on my old account other than an overdraft. Never had any issue with account related to my insolvency.

Their service isn't the best Ive ever had (they have had issues with PIN verification twice in the last year which affected me) - but they have always been friendly and helpful on the phone and in branch and the account has provided me with everything I need. I'll probably keep banking with them when I come out of it because they havent ever done anything to annoy me enough to want to move.