New Charges on Charity bank accounts with HSBC

neilharg149

I am the secretary of a branch of a philanthropic charitable society and have recently been informed that our "business" bank account with HSBC is being changed to a ' Charity' bamk account. The difference is that there is nothing charitable about the new account. They are introducing a £5 monthly charge and fees for transactions which includes paying in cash at a branch and cashing cheques. Most of our income is cash from members and our rules dictate that payments are by cheque with multiple signatories. 
As a result we are looking for a different bank but suspect that many larger banks will go the same way.
Any recommendations would be most welcome.

General_Grant

Rather than find a new bank, can you change your rules to allow electronic payments requiring two "signatories"?

Can a member act as a cash exchanger - accept the cash, pay to your account electronically?  There could be a paper trail of receipted note for the cash they handle.

HobgoblinBT

Similar message received relating to a family Trust account for the benefit of a mentally handicapped relative.  I am not impressed with the £10 per month charge as well as transaction fees, but don’t have much option.  I can understand why the charges have been introduced, having seen first hand the immense amount of work required in order to meet the kyc and aml requirements.  

kuratowski

Maybe ask on the small biz & charities board? https://forums.moneysavingexpert.com/categories/small-biz-charities-moneysaving
One possible name I've seen is https://www.unity.co.uk/

geraint83

I've also received an e-mail from HSBC about this today, in relation to the school PTA's bank account (for which I'm Treasurer).

It'll be a right pain moving the account to another bank, because they'll all probably go down this route eventually, as suggested above.

Former_MSE_Sophie

Hey everyone - we have published a piece on the new HSBC charity bank account and what accounts other banks offer.

https://www.moneysavingexpert.com/news/2021/09/thousands-of-hsbc-customers-to-be-affected-as-bank-reveals-chari/

MoJoeGo

It might sound absurd to those of you involved in running small charities, but they are generally regarded as amongst the highest risk types of customer that a bank can have. 

Limited regulation and governance, often run by relative amateurs (however well meaning) with little financial experience, taking in often significant untraceable amounts of cash from many donors, often for the stated benefit of other people in 'developing' countries. And plenty of situations where the money has actually ended up in the hands of corrupt politicians or terrorists. With the further issues of tax fraud and money laundering thrown in for good measure.

Unfortunately for the banks, it's a bit of a minefield, and the amount of expensive and regular due diligence they have to do makes charities not their favourite type of client. It's not personal, it's just (regulated) business.

Brie

In addition to what MoJoeGo has said and as much as we all hate it banks are businesses first and foremost and therefore are expected to make a profit.  Handling cash and cheques is very expensive.

Should you decide to go down having a cash handling intermediary you might want to get an account at NatWest as they have machines that can accept large amounts of coins directly into the ATM.  Bills too I believe.  Of course they might get cranky with anyone depositing in this way regularly.  And they might suspect that it is a "business" account rather than personal and shut it down accordingly.  Might take them a while though.

General_Grant

Brie said:

In addition to what MoJoeGo has said and as much as we all hate it banks are businesses first and foremost and therefore are expected to make a profit.  Handling cash and cheques is very expensive.

Should you decide to go down having a cash handling intermediary you might want to get an account at NatWest as they have machines that can accept large amounts of coins directly into the ATM.  Bills too I believe.  Of course they might get cranky with anyone depositing in this way regularly.  And they might suspect that it is a "business" account rather than personal and shut it down accordingly.  Might take them a while though.

As I understand it, you can tip in your loose change and the ATM spits out a receipt which shows the total and you take that piece of paper to a human teller who adds the sum to your account.

spenderdave

Note that many of those involved in this change are ordinary clubs and societies, NOT charities. All 'community' accounts are moving to this 'charity' account regardless.These, although maybe not the best knowledgeable are hardly large turnover concerns and don't go begging for money. Ours has a turnover of around £500 a year, the £60 fees is a lot of our turnover so we will have no option but to move.

One other change is the move of a considerable number of HSBC branches to their new 'digital' format, the most significant change being the removal of in-branch counters. Our church is now unable to pay cash into our account there as being a charity with dual signatures we do not have a debit card to use their paying in machines or for that matter the Post Office.

General_Grant

spenderdave said:

Note that many of those involved in this change are ordinary clubs and societies, NOT charities. All 'community' accounts are moving to this 'charity' account regardless.These, although maybe not the best knowledgeable are hardly large turnover concerns and don't go begging for money. Ours has a turnover of around £500 a year, the £60 fees is a lot of our turnover so we will have no option but to move.

One other change is the move of a considerable number of HSBC branches to their new 'digital' format, the most significant change being the removal of in-branch counters. Our church is now unable to pay cash into our account there as being a charity with dual signatures we do not have a debit card to use their paying in machines or for that matter the Post Office.

I am involved with a charity and we have current accounts with CAF and Barclays.  We require two signatures on cheques and dual authorisation of online payments but also do have debit cards.