Basic bank accounts give customers confidence in handling their finances
New research released today (Monday) shows that more than three-quarters (77 per cent) of active users of basic bank accounts feel that they are more confident in dealing with money as a result of opening the account.
The research, conducted by Millward Brown on behalf of the British Bankers' Association among 1,000 adults who had opened a basic bank account in the previous 12 months, shows that:
90% of customers are confident that the account meets their needs
92% of customers felt that opening an account was simple and straightforward
91% of customers are satisfied with the way the account has been handled
87% of active users are satisfied with the functions provided by the account
Customers generally cited the simplicity of the account as the reason for opening a basic bank account. Only one per cent would consider closing their account and not opening another.
Figures also released today show that a net total of 121,000 basic bank accounts were opened in the fourth quarter of 2005, with 6,100 accounts being upgraded to more fuller-featured accounts. A net total of 1.64 million basic bank accounts, all of which can be accessed through post office branches, have been opened since this type of account was launched in April 2003. Including other accounts with similar 'basic bank account' characteristics opened prior to that date and basic accounts that can only be operated through bank branches, there are now over 5.9 million accounts with basic functionality in operation.
Welcoming the report, Ian Mullen, chief executive of the British Bankers' Association said: "Access to banking services is the lynch pin to financial inclusion and this research clearly shows that the features of the basic bank account closely match peoples' needs. As customers become more confident with their finances, a change to an account with fuller features may be appropriate."
For further information, please contact:
Joanna Elson, Executive Director 020 7216 8849
Brian Capon, Head of Media Relations 020 7216 8810
Notes to Editors
- A copy of the full report is available from the link below
- Basic bank accounts are designed for people who want to ensure that they cannot overdraw their account or who might not meet the banks' criteria for opening a standard current account. Features typically include the ability for payments, for example pensions and benefits, to be credited direct to the account, withdrawals by plastic card through cash machines and the facility to pay bills by direct debit. This type of account does not provide overdraft facilities nor, typically, a cheque book.
- Since April 2003 direct payment into bank accounts or Post Office card accounts has been the normal method of payment for benefits and tax credits. Sixteen banks now offer basic accounts that can be accessed through Post Office branches. Full details of these are published by the Financial Services Authority (FSA) both on their website and in their leaflet: No bank account? Why it could pay you to have one.
- Figures as at the end of December 2005 were:
- Total number of all accounts with "basic banking" functionality: 5,934,155;
- Total number of all accounts with "basic banking" functionality accessible through post offices: 2,368,356;
- Total numbers of accounts opened, net of closures, during each quarter were:
Apr-Jun 03 : 111,519
Jul- Sep 03 : 147,908
Oct-Dec 03 : 152,313
Jan-Mar 04 : 150,487
Apr-Jun 04 : 145,126
Jul-Sep 04 : 182,989
Oct-Dec 04 : 179,445
Jan-Mar 05 : 163,208
Apr-Jun: 05 :147,767
Jul- Sep 05 : 137,994
Oct-Dec 05 : 121,128
The above figures relate specifically to accounts opened since the launch of universal banking that can be accessed in both branches and at post office counters, thus giving a better representation of the banks' contribution to the goal shared with HM Treasury of increasing financial inclusion.
- Banks offering basic bank accounts accessible through the Post Office are:
Abbey, Alliance & Leicester, Bank of Ireland, Bank of Scotland, Barclays Bank, Clydesdale Bank, Co-operative Bank, First Trust Bank, Halifax, HSBC Bank, LloydsTSB, NatWest Bank, Northern Bank, The Royal Bank of Scotland, Ulster Bank and Yorkshire Bank.