November 2023
Dear Constituent,
Thank you for contacting me about bank account closures.
Freedom of speech is a cornerstone of our democracy, and it must be respected by all institutions. Banks occupy a privileged place in society, and it is right that we fairly balance the rights of banks to act in their commercial interest with the right for everyone to express themselves freely.
On 21 July, the Government confirmed that it would strengthen regulations overseeing banks and payment service providers to increase the minimum notice period in cases of provider-initiated contract terminations from two months to 90 days – giving customers more time to challenge a decision through the Financial Ombudsman Service or find a replacement bank.
Providers will also be required to spell out to the affected customer why they are terminating their contract – increasing transparency and aiding customers’ ability to appeal decisions. This requirement will be subject to limited exceptions where firms need to comply with existing legal obligations, for example, under financial crime law.
These changes are only possible due to new powers in the Financial Services and Markets Act 2023, which give Britain control of its financial rulebook following Brexit.
The new rules run alongside separate plans to clarify in legislation the requirements for Politically Exposed Persons and a review into whether they are being applied proportionally by financial institutions. These steps were commissioned by Parliament in June as part of the Financial Services and Markets Act 2023. The review was launched by the Financial Conduct Authority (FCA) in September and will report by the end of June 2024.
Additionally, I understand the FCA is also looking more broadly into the scale of account closures on the grounds of expressions of political or other opinions.
Please be assured that I will continue to monitor this issue closely.
Thank you again for taking the time to contact me.
Best wishes,
Angela Richardson MP
Member of Parliament for Guildford, Cranleigh and our villages