MSE News: Public 'backs portable bank account numbers'

Former_MSE_Helen · 13 September 2012 at 9:11AM

"Consumers would be more likely to switch their bank account if they could keep their account number, says Which? ..."

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Public 'backs portable bank account numbers'

agrinnall · 13 September 2012 at 9:47AM

But would the public back the large cost that they will have to pay in order for the banks to change all of their systems to allow this to happen?

InsideInsurance · 13 September 2012 at 11:00AM

Whilst the headline was about portable bank account numbers what the article went on to say was actually not having to move/ update direct debits etc.

This therefore is potentially therefore much more than just meaning you keep the same 8 digit account number.

As has been said, to allow it to happen there is going to be a big fundamental change in how banking works, sort codes could no longer identify banks etc, and therefore with it a massive cost.

Given this gives no competitive advantage to any one bank its going to be very hard to get the industry as a whole to move and spend such a vast sum of money in a coordinated way.

Look at Faster Payments, suggested as required in 1998, greed in 2005 and partially implemented May 2008 and by October 2009 - 11 years later - only 45% of standing orders were using it.

tagq2 · 13 September 2012 at 11:08AM

A single interbank database mapping virtual to real #s, mostly read-only? I'm sure if the banks were designing DNS, they'd argue that they need a billion pound subsidy to implement CNAMEs too.

I guess if you really wanted to commercialise it, you'd start with a group of portable sort codes and charge people to migrate once to it in return for the promise that it will be available for x years, renewable. Just as anyone with sense rents a domain name so they're not tied to their ISP or GFail or whatever, even if e-mail is simply forwarded to an ISP/webmail account.

Pincher · 13 September 2012 at 11:19AM

BACS, Bank Automated Clearing System will need to maintain a mapping system, so you just apply to change your physical bank details and use your portable number. It does mean changing every standing order and direct debit you have, as well as informing anyone who wants to send money to you.

If somebody manages to hack into this mapping, they can divert money into their own account. In one night, millions could be transferred into one account, which will be wired overseas the next morning.

Even if BACS sends out advisory e-mails for every change of mapping, if this was done at 16:50, it is unlikely people will see it until the next day, by which time the money has already gone.

With the current system, the destination is hardcoded, and is much harder to hack en masse.

tagq2 · 13 September 2012 at 12:01PM

I assume the priority would be for consumer DDs+SOs, so the mapping is concerning (typically) *source* of funds rather than destination.

I understand the concern of say, a virtual account receiving A Lot Of money on a daily basis having its destination changed, but that's a different market segment. It certainly shouldn't admit an instant, fully automatic mapping update any more than the bank would allow an instant electronic change of business name and address details. It might not even be appropriate at all to have large businesses hold virtual accounts.

Any mapping changes might, I suppose, be initiated by new bank with customer consent confirmed from old bank also. The customer is supplied a definite date on which money comes from new rather than old account. This isn't zero admin, but may be better than the current system of requesting your new bank update each DD and SO and at least one DD inevitably failing - probably an important one affecting e.g. insurance cover.

martinaj · 13 September 2012 at 1:01PM

For everyone to have their own portable account number will require a fundamental change and will involve tremendous cost. Who will pay? "If it ain't broke, why mend it?"

If people want to change banks it's easy, with guaranteed service levels regarding moving DDs and SOs and issue of cheque books and cards.

Besides, I have accounts and credit/debit cards with more than one bank. I use a "Money" program to keep track of all my accounts and with online banking I can check my balances each day and move money where it gets best interest. I know when to "ditch and switch".

I don't need a portable account number and I certainly don't want to pay for one!

jamesd · 13 September 2012 at 3:52PM

At the moment the interface to change DD or SO is in the wrong place. It should be at the place where the DD or SO is currently held, with an instruction to switch there, combined with a consent choice at the receiving account. Want to move:

1. Tell the current bank to move the DD to the new one.
2. At the new one confirm that you've made this request and want it to go ahead.
3. New bank tells DD originator to change the DD and the current bank to forward this DD payment request to it from now on, perhaps with a one day delay.

Similar for SO but step 3 becomes the current one stops paying, the new one starts.

Those are the source of funds side, at the recipient usually company side there are forwarding issues for payments made using old details which could generate a "please update the details you use" notification to the originator.

Moving DDs isn't always about moving banks, it's sometimes just about which account you want the money to come from.

Chrisblue1962 · 13 September 2012 at 5:00PM

To me this would be a pointless costly exercise.

It's not rocket science to change your bank account.

rogerblack · 13 September 2012 at 5:25PM

I wish that there was a standard way for programs to talk to banks.
This would allow the creation of apps that enabled simply moving money between your accounts, and monitoring balance.

Rather than seperate non-integrated apps.

alanq · 13 September 2012 at 5:35PM

There is more than enough scope for foul ups at present. I see the potential for far worse with this proposal. Is there any country in the world that is successfully operating such a system?

MSE News: Public 'backs portable bank account numbers'

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