Thousands of Britons living in EU told their UK bank accounts will be closed
Thousands of Britons living in the EU will have their UK bank accounts closed by the end of the year because of the UK’s failure to agree a post-Brexit trade deal.
Lloyds, Barclays and Coutts have informed retail and business customers that they will lose their accounts before or when the Brexit transition period ends on 31 December and more banks are expected to follow suit.
Lloyds Banking Group, which includes Halifax and Bank of Scotland, has contacted its 13,000 customers in the Netherlands, Slovakia, Germany, Ireland and Portugal, warning them they must make alternative arrangements as the bank is no longer allowed to offer services.
A spokesperson said: “We have written to a small number of customers living in affected EU countries to let them know that due to the UK’s exit from the EU, regrettably we will no longer be able to provide them with some UK-based banking services.
“We want to keep customers informed and offer advice on next steps.”
Financial services in the UK can currently trade across the European Economic Area (EEA) because member countries are bound by the same regulatory framework.
The arrangement, known as “passporting”, expires at the end of the year and, while the UK has legislated so that EU banks can continue to provide services for customers in Britain, the EU has not done the same.
Unless a trade deal is agreed with the EU, UK financial institutions will have to abide by often arcane rules which vary from country to country and depend on what services are being offered by what kind of bank.
Last week, the Dutch National Bank confirmed that UK banks will no longer be able to provide current or savings accounts to retail customers in the Netherlands.
Customers who bank with firms that own EU-based subsidiaries are having their accounts transferred, but banks that do not have an EU arm would have to apply for a licence to trade in each EEA country. Some banks have too small a customer base in the EU to justify the cost.
One Lloyds customer said she feared she would be cut off from her UK pension payments after the bank had informed her she would not be able to use her current and savings accounts after 2 November. Her balance will be returned to her as a cheque and all payments after that date will be returned to sender.
“I don’t know what will happen about tax rebates from HMRC or council tax and bills on the property we own in the UK,” she said.
‘“I don’t know if it’s possible to arrange direct debits and standing orders to UK institutions from a Dutch bank and there will be a lot of expense incurred if payments that skip through the net are returned to sender or if I have to convert euros to sterling whenever we are in the UK.”
Barclays has also notified customers across the EEA that their accounts will be closed.
One who lives in Germany was told she would no longer be able to use her Barclaycard, which she depends on for transactions within the UK.
The customer, who did not want to be named, said: “I’ve had the card for 40 years and pay it off each month from my pensions, which are paid into my UK account, so I’m not sure I’d qualify for a German credit card,” she said.
She said she owned a property in the UK and paid taxes in the country and that she wanted “to maintain my financial arrangements there in case I ever need to live there again”.
A Barclays spokesperson said: “In light of the UK leaving the EU at the end of 2020 we continue to review the services we offer to customers within the EEA, and any impacted customers will be contacted directly.”
Other banks have yet to decide on future arrangements. Santander and NatWest said they were keeping the situation under review and currently had no plans to withdraw retail or corporate accounts.
HSBC, which has a large number of customers in France, Germany and Switzerland, said that as an international bank it could continue to serve UK customers across the EU, but would keep them informed of any changes that might affect services.
UK financial services are regulated by the Financial Conduct Authority which said it expected banks to engage with national regulators to assess the impact of local laws on customers and to inform customers of any changes in a timely manner.
According to the financial trade body UK Finance, banks are having to unpick the legislation of 30 different countries to work out if they can continue serving customers.
“Where possible, firms want to keep providing banking services to customers living in the EEA after the transition period,” said a spokesperson.
“The impact on each customer will vary depending on the operating model of their bank or provider, the product or service being provided, and the legal and regulatory framework in the country in which they are resident.”
https://www.theguardian.com/money/2...k-bank-accounts-closed-lloyds-barclays-brexit
