Bank details on applications forms

Compound_2

I was wondering about the ‘bank details’ section of many applications forms, even when there is no question of a direct debit/credit. They ask for sort code/account number (but not reference no if applicable). I was wondering whether this is for ID purposes, but can anyone outside your bank verify the details? Do credit reference files show actual sort codes and account numbers? I thought they didn’t even show current accounts with no overdrafts. Can you put a savings account if the wording on the form does not exclude this?

I’m guessing people on here have more than account. Does it matter if you use different accounts for different applications? If you’re applying for a product from a bank you have an account with, it might look good to put down that account. But that might depend on the account's turnover.

There is also a ‘time with bank’ question on credit applications, sometimes ‘time account held’ which is not synonymous. I’ve been told by lenders the longer the better for the credit score, so can you exploit this by giving the longest relationship, regardless of whether it’s your main account? Can they access the turnover of the mentioned account – surely they’d have to ask you for statements for that? So you can just put the bank where your parents opened an account for you as a kid. One corollary is you shouldn’t close accounts.

They ask for the length of time down to the nearest month, but when I asked branch staff for this they said they haven’t a clue, it’s not possible to find out, just guess. So what’s the point of the question?

jamesd

Credit reference files for most banks will show the existence of an account which was opened in the last few years. Older account holders generally hadn't granted consent for this information sharing and their accounts will often not be visible. Newer accounts generally show only "negative" information, often with some overdraft allowed before any is reported. Some newer accounts do show "positive" information of account balance, it depends on what information the bank itself wants from the credit reference agency - they only get positive data if they share positive data.

The account you've had the longest is likely to be the best one to use if you're asked how long you have had the account. Main account is often for you to determine, though it'll normally be either the one used for most bills or the one you salary is paid into if they give guidance about which they want.

The online banking service for one of my accounts gives the date the account was opened, though it's possible that it is only the date the account was migrated to the computer system. If you make a guess, note down your guess and be consistent in future because this information may be shared.

If the application form grants consent to take up references they could contact the bank. It's likely that the application does so if the bank details are requested.

Compound_2

I thought that banks were reluctant to give references and charge for the service. They would need you to instruct them directly, rather than a vaguely worded consent through a third party. I think the right to take references refers to the credit reference agencies.

I wouldn’t have thought older accounts were less likely to appear. Banks just send out amendments to T&C to allow more data sharing—if you don’t close your account during the notice period you are deemed to have consented.

It appears that the bank details (other than time with bank, which counts in the credit score) are as irrelevant as the salary details requested by some Barclays staff when opening an ISA. I have seen some efficient ‘priority application’ credit card forms which just ask for ‘time with bank’, leaving you free to determine what this means. This site is all about people regularly changing providers to get the best deal. It would be quite wrong if the credit scoring process almost forced people to keep their money in a poor paying account. So people should just quote their first bank even if it’s not where most of their money goes, as it is a continous relationship provided an account is still open there. I think Martin’s recommendation to close old accounts should be seen as applying just to credit cards, as there are advantages to old bank accounts.

jamesd

"there are a further 40m accounts opened before banks changed their terms and conditions where customers have not been asked if they are happy for their details to be disclosed to third parties for credit checking purposes. These are called "non-consensual" accounts, and data relating to them cannot currently be shared"

There are plans to completely ignore the preferences of these current account holders who have declined to give consent and let banks share it anyway. I have both a current account and a credit card in this category and I do want to keep those banking details away from CRAs unless I've defaulted. If anyone is truly interested and has sufficient reason they can seek my consent and obtain a reference directly from the bank.

Compound_2

Thanks for the article—quite frightening stuff for MoneySavers with many accounts. Quite often when opening a top paying savings account, you need to open a current account with the provider too (sometimes it’s just mis-sold as we’ve heard with Barclays). Pity we have a Government who isn’t on the side of those who do the right thing, preferring to protect the irresponsible.

LittleVoice

Compound:

You originally wrote about "application forms". I wondered what sort of application forms you had in mind. What is for financial products or other things?

Compound_2

LittleVoice, it is forms for financial products. The question is pretty universal on credit card forms, although I have occasionally seen it omitted in junk mail 'express'/priority invitations. Sometimes it is asked when opening savings accounts, even when there is no 'linked' account for electronic deposits/withdrawals. We've been discussing in the savings forum about banks asking for income information and trying to push other products like current accounts.

(The only legitimate place I can think of for requesting bank details (apart from direct debit mandates) is when opening another current account, ie for transfer purposes. The new bank may want to see statements showing how the old account was conducted, what overdraft facilities you had, etc, to help decide what to offer.)

LittleVoice

Thanks for your reply. It's just that I've seen some impertinent questions on job application forms - and wondered if any were asking about bank account details on the basis that they would want the information to pay you.

I think I was asked for bank account details when I started to sign up for secret shopper work - and it wasn't even a secure site, so I didn't proceed with the application.

PBA

When it's for a scored product (bank account, credit card, loan, etc) it's for the credit score. The fact that you've already got a bank account adds points to your score so making it more likely you'll be accepted. If it's for a savings account then there's no real reason, maybe market research or to facilitate cross sales at a later date...