Refused savings accounts

contibun

I have had an account with Starling for several years and have a £20k sat in various 'spaces'. I tried to open an easy savings account but was rejected so tried a flexi account and was also rejected. I am going to have to go elsewhere which is frustrating, but I don't understand why I would be rejected when I have funds in there and a good banking history. If I open savings accounts  elsewhere I will move all my banking. I have lived in the same house for 30 years, worked full time in the same company for the last 30 years, have a good credit rating, no mortgage on my house and no debt.  They won't tell me why I have been rejected and I am concerned that it's something that might happen elsewhere if there is something I need to fix. Any ideas?

surreysaver

Are you on the electoral roll?

refluxer

On the plus side, Starling's interest rates for their savings accounts are poor and you'll find better rates by looking elsewhere. As applying for a savings account doesn't involve a credit check, then there's no harm in looking elsewhere and applying as a way of finding out whether this problem occurs with other banks.

If you do find a savings account with a different bank or building society that you're interested in and your application gets accepted, then there's no need to sever ties with Starling completely. If, for example, you have a current account with them that works well, then there's no reason why you can't keep it and use it as the nominated account for a savings account with a different bank. You'll find that a good proportion of the banks who offer the highest savings account rates don't actually offer current accounts, in which case you'll need one elsewhere anyway.

contibun

Yes I am on the electoral role - and have been with the same details for the last 30+ years

contibun

refluxer - you are right there are better products out there - I just like to keep things in one place so it was tempting to stay with a poorer return to be 'tidy'. I think I need to look around so maybe it has indeed done me a favour - it is frustrating that you are not allowed to know why you have been rejected though!

dunstonh

It could be due to failing AML checks.   Starling were fined £29m recently for failings with AML.

When a bank fails in AML checks and the regulator is involved, then they usually have to go above and beyond the typical for a period.     So, if you fail their revised checks, they may not use discretion for manual checks and just refuse the account.   

refluxer

contibun said:

refluxer - you are right there are better products out there - I just like to keep things in one place so it was tempting to stay with a poorer return to be 'tidy'. I think I need to look around so maybe it has indeed done me a favour - it is frustrating that you are not allowed to know why you have been rejected though!

Yes, I get that the simplicity of sticking with one bank for all your savings is appealing but, with interest rates still being relatively high, you could be losing out on hundreds or possibly even thousands of pounds of interest by doing this (obviously depending on the amount of savings you have and where you currently have them) which seems a shame, especially considering just how easy it is to apply for accounts online these days.

There are large numbers of savers on this forum who have accounts with dozens and dozens of different banks and building societies but even if you wouldn't want to commit yourself to that extent, even just having a current account with one bank and a savings account or two with another could be well worth your while and involve very little hassle.

Albermarle

There are large numbers of savers on this forum who have accounts with dozens and dozens of different banks and building societies but even if you wouldn't want to commit yourself to that extent, even just having a current account with one bank and a savings account or two with another could be well worth your while and involve very little hassle.

As above. Even if you leave your current account with Starling, you could just open up a couple of better paying accounts with new providers .
No need to chase every last 0.1% by opening multiple accounts, if you are not that way inclined. In any case the benefits of doing that are marginal unless you have a LOT of savings.

Middle_of_the_Road

Albermarle said:

There are large numbers of savers on this forum who have accounts with dozens and dozens of different banks and building societies but even if you wouldn't want to commit yourself to that extent, even just having a current account with one bank and a savings account or two with another could be well worth your while and involve very little hassle.

As above. Even if you leave your current account with Starling, you could just open up a couple of better paying accounts with new providers .
No need to chase every last 0.1% by opening multiple accounts, if you are not that way inclined. In any case the benefits of doing that are marginal unless you have a LOT of savings.

It's always suggested on here to have a second current account set up, incase you lose access to your main bank account. This is especially true with the current de-banking scourge that's mentioned so often. Equally, if your bank suffers an IT system issue, you have an alternate source of funds.

Hoenir

Seems that 

Starling Bank has voluntarily agreed not to open new accounts for high or higher risk customers while it improves its anti-money laundering (AML) controls

eskbanker

Hoenir said:

Seems that 

Starling Bank has voluntarily agreed not to open new accounts for high or higher risk customers while it improves its anti-money laundering (AML) controls

According to the FCA, that was what they had agreed to in September 2021, but carried on opening them anyway, and were eventually fined for that:

Starling commenced an AML Enhancement Plan to address the FCA’s concerns and voluntarily accepted a requirement from the Authority in September 2021 (the VREQ) not to open any new accounts for high or higher risk customers while it improved its AML control framework.

[...]

Starling however failed to implement all of the underlying requirements and subrequirements of the VREQ properly and did not adequately monitor its compliance with the terms of the VREQ following its imposition. As a result, over the Relevant Period, Starling opened 54,359 accounts for 49,183 high or higher-risk customers in breach of the terms of the VREQ

https://www.fca.org.uk/publication/final-notices/starling-bank-limited-2024.pdf