Reliance Bank pull current accounts

Stuart_W

One of the smallest current account providers, Reliance Bank (owned by The Salvation Army) who were part of the current account switch scheme, has now withdrawn the provision of personal current accounts.
The introduced a monthly fee for new customers a couple of years ago but have now pulled out completely. All existing accounts remain as they are. I have one of the free ones still. 
It seems most small providers are winding up current account provision as it simply isn't profitable without scale and as we've seen with post office, n&p and M&S there isn't even value is selling customers en mass to another provider. Unless any of the fintechs work out how to actually make a profit, it's hard to imagine how in the long term personal banking can change from being dominated by the major players. Even moreso now than before.  

Thrugelmir

Technology needs to be paid for. The UK is fairly unique in having fee free current accounts. The writing has been on the wall for a very long time. Provision of personal accounts is a loss leader paid for by other services. 

jbuchanangb

I will keep my fee-free current account with Reliance Bank. It is essence of an ethical bank. I still have an account with the Co-operative bank, but only use that for the worldwide travel insurance, mobile phone insurance and credit file monitoring which for two pensioners with a phone each is a steal at £132pa. I took all the other banking business away from the Co-op at the time of the crystal Methodist scandal, and nowadays their ethical credentials are very weak.

Stuart_W

Just to pick up on this old thread, Reliance Bank this month (September 2023)  have now announced that virtually ALL existing current accounts will be closed and folk have been served their 60 days notice of account closure - of which I am one.

No doubt maintaining such a small current account customer base was costing a fortune for them.

They are offering to continue provision for Salvation Army employees and Salvation Army pensioners who want it but otherwise accounts are being closed.

They are still CASS members, so it is an easy chance to pick up £200 or so from a switch but I'm a little bit sad to see this account go. I joined at the beginning of Co-op's issues.

With the deadline of next month for interested parties to get involved with the sale of Co-op Bank, we might finally see the consolidation of the medium sized players that has been much talked about. 

WillPS

Thank you for updating. It's a shame the Salvation Army couldn't make it work, few would be better placed to manage an "ethical bank" than them.

jbuchanangb

I haven't been notified yet. Can't see anything on their website. I guess I will revert to using my Co-op account. I recently moved some savings money in to the Co-op Privilege Savings account because the interest rate is tracking just below the Bank of England base rate and has become quite attractive. So I know my online banking is up to date. There will be a bit of hassle changing over standing orders and direct debits etc.

Stuart_W

jbuchanangb said:

I haven't been notified yet. Can't see anything on their website. I guess I will revert to using my Co-op account. I recently moved some savings money in to the Co-op Privilege Savings account because the interest rate is tracking just below the Bank of England base rate and has become quite attractive. So I know my online banking is up to date. There will be a bit of hassle changing over standing orders and direct debits etc.

They are probably notifying customers in tranches so their small team can process the closures. Rather than a long window like N&P and the Post Office did when they ditched current accounts, using the contractual 60 days notice clause on groups of customers at a time means they dedicate resources evenly rather than everyone have the same deadline.


 You can use the CASS even if your account isn't new so once you are served notice, get your existing Co-op account to do a switch. I used CASS to switch a Santander account (that I only opened for the opening offer) to my co-op account that had been open for 20 years. Obviously promotional incentives don't apply as you are not a new customers but it gets direct debits and credits etc sorted.

jbuchanangb

 You can use the CASS even if your account isn't new so once you are served notice

That's useful to know. Although the £175 Lloyds switching incentive is looking attractive. It might also be sensible to keep the Co-op as a "spare" account against the risk that our "main" account suddenly becomes unavailable.

jbuchanangb

I have now been notified by Reliance. As Lloyds do not permit an online application for a joint account, I have submitted such an application to Nationwide, which has been accepted.