FCA: Banks Need to Make It Easier to Create Accounts

The U.K.’s Financial Conduct Authority (FCA) wants banks to make it easier for customers to apply for accounts.

The regulator issued a report encouraging banks and other account providers to increase awareness about basic bank accounts and found that several providers could make the application process easier, according to a Wednesday (Sept. 4) press release.

“We’ve seen examples of really good practice — with account providers helping people access a product vital for financial inclusion — but also areas where there is room for improvement,” Sheldon Mills, FCA executive director of consumers and competition, said in the release. “By sharing both, we want to achieve more consistent outcomes, with people being aware of what accounts there are that might be right for them, more support for the vulnerable and people not being denied access without good reason.”

The FCA is asking banks to review their approach to account denials and closures, preventing vulnerable customers from missing out, and making sure people aren’t denied access because they can’t show standard forms of identification, the release said.

Last year, the FCA did not uncover evidence of accounts being closed “due to lawfully expressed political opinions,” and the new report confirms there is still no indication that this is occurring, per the release.

“However, it has asked senior leaders in firms to sign an attestation taking personal responsibility for ensuring rules have been complied with and that they are confident of their compliance going forward,” the release said.

In other banking news, there have been calls by U.S. regulators in the sector for banks to take measures to preserve and strengthen their operational resilience.

For example, the “Semiannual Risk Perspective” from the Office of the Comptroller of the Currency (OCC) said this means pinpointing critical operations and core business lines and “mapping interdependencies within a bank’s organization and with significant third parties.”

Increased connections across the industry raise the threat of a single participant’s outage, leading to wider disruption in the sector, the OCC said.

“Think, then, of a bit of domino effect,” PYMNTS wrote. “A FinTech or other partner is hit by a cyberattack, operational failure or loss of customers, forcing them to go dark, so to speak, and the ripple effects hit the federal banking system at large.”