Scrap ATM limits, banks told

 

Two banks partly owned by the state have been urged by MPs to drop restrictions on customers with basic bank accounts using cash machines run by other banks or third parties.

The Commons Treasury Committee said the rules imposed by RBS and Lloyds TSB, both of which needed a taxpayer bailout following the 2008 banking crisis, risked compromising the cash machine network.

The MPs said the impact of the rules could hit the poorest hardest, for potentially only a small financial gain for the banks.

Barclays, HSBC and Santander - which is due to take over RBS branches in England and Wales following the 2008 bailout - were praised by the committee for providing basic bank account holders with unrestricted access to cash machines operated by third parties.

Tory MP Andrew Tyrie, who chairs the committee, said: "Restricting access to cash machines could compromise the network.

"In certain areas, more than a third of ATMs could be placed at risk if other providers of basic bank accounts were to take similar action or to remove themselves from the LINK system.

"The Committee understands the need for banks to control costs, particularly in these difficult times.

"In this instance, the financial benefits to Lloyds and RBS appear relatively small but those affected would be amongst the most vulnerable people in society."

Mr Tyrie said he acknowledged in the longer term both the services offered to banking customers and the charges they paid would need to be reformed.

The Treasury Committee is to write to other bank account providers to confirm their stance on allowing customers to use cash machines operated by other banks or third parties.

Basic bank accounts are available to those who may not meet banks' minimum criteria to open a personal current account owing to a poor credit score or no credit history.

They often do not offer any overdraft and sometimes do not have a debit card, but can be used to receive direct payments and to set up standing orders and direct debits.

A total of 16 banks operating in the UK offer a basic bank account product.

RBS, and its sister bank NatWest, phased in the restrictions on basic bank accounts in November 2011.

Lloyds TSB has applied similar rules on basic bank accounts opened since September 2011.

A Lloyds TSB spokeswoman said: "Lloyds TSB basic bank account customers are able to withdraw money from all Lloyds Banking Group cashpoints including Halifax and Bank of Scotland machines. This gives them access to over 6,500 cashpoints.

"In addition, customers can also use over 12,000 Post Offices nationwide, which means that almost all of our basic bank customers are able to access their money within one mile of where they are based.

"Our customers benefit from a free banking service, with many of the functionalities of a normal bank account - for example, the ability to set up standing orders and direct debits.

"It also provides access to internet, phone and mobile banking, including text alerts to help customers manage their money.

"The fact that we opened over 100,000 new basic bank accounts last year shows that customers really value the range of services that we provide.

"We remain fully committed to providing a range of basic bank accounts to suit our different customer needs."

A Which? spokesman said: "When people are struggling to cope with their household bills it's right that the Government are putting pressure on those banks who are penalising some of their most financially vulnerable customers.

"We'd urge consumers to vote with their feet by switching to a bank that doesn't impose unfair charges on its customers."

PA

News
i100
News
people Emma Watson addresses celebrity nude photo leak
News
The Prostate Cancer Foundation is returning all donations made by Redditors 'in honour' of Jennifer Lawrence and her naked photos
news

Website users raised funds after Jennifer Lawrence nude photo leak

News
Katie Hopkins appearing on 'This Morning' after she purposefully put on 4 stone.
peopleKatie Hopkins breaks down in tears over weight gain challenge
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksAn unforgettable anthology of contemporary reportage
News
news

The Tardis-style house measures in at just 83 inches wide

News
advertising
Arts and Entertainment
Robert De Niro, Martin Scorsese and DiCaprio, at an awards show in 2010
filmsDe Niro, DiCaprio and Pitt to star
News
i100
Life and Style
Red or dead: An actor portrays Hungarian countess Elizabeth Báthory, rumoured to have bathed in blood to keep youthful
health
News
In this photo illustration a school student eats a hamburger as part of his lunch which was brought from a fast food shop near his school, on October 5, 2005 in London, England. The British government has announced plans to remove junk food from school lunches. From September 2006, food that is high in fat, sugar or salt will be banned from meals and removed from vending machines in schools across England. The move comes in response to a campaign by celebrity TV chef Jamie Oliver to improve school meals.
science
Sport
England captain Wayne Rooney during training
FOOTBALLNew captain vows side will deliver against Norway for small crowd
News
peopleJustin Bieber charged with assault and dangerous driving after crashing quad bike into a minivan
News
peopleHis band Survivor was due to resume touring this month
News
people'It can last and it's terrifying'
Life and Style
fashionModel of the moment shoots for first time with catwalk veteran
Sport
Radamel Falcao poses with his United shirt
FOOTBALLRadamel Falcao's journey from teenage debutant in Colombia to Manchester United's star signing
Life and Style
fashionAngelina Jolie's wedding dressed revealed
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Renewables Consultant

£28000 - £34000 Per Annum: The Green Recruitment Company: Job Title: Renewable...

Energy Procurement Consultant

£26000 - £34000 Per Annum: The Green Recruitment Company: Job Title: Energy Pr...

Swimming Teacher/Coach

£15000 - £21000 per annum: Randstad Education Chelmsford: Would you like to wo...

Teachers needed in Debenham

Competitive & Flexible: Randstad Education Cambridge: The JobRandstad Educatio...

Day In a Page

Chief inspector of GPs: ‘Most doctors don’t really know what bad practice can be like for patients’

Steve Field: ‘Most doctors don’t really know what bad practice can be like for patients’

The man charged with inspecting doctors explains why he may not be welcome in every surgery
Stolen youth: Younger blood can reverse many of the effects of ageing

Stolen youth

Younger blood can reverse many of the effects of ageing
Bob Willoughby: Hollywood's first behind the scenes photographer

Bob Willoughby: The reel deal

He was the photographer who brought documentary photojournalism to Hollywood, changing the way film stars would be portrayed for ever
Hollywood heavyweights produce world's most expensive corporate video - for Macau casino

Hollywood heavyweights produce world's most expensive corporate video - for Macau casino

Scorsese in the director's chair with De Niro, DiCaprio and Pitt to star
Angelina Jolie's wedding dress: made by Versace, designed by her children

Made by Versace, designed by her children

Angelina Jolie's wedding dressed revealed
Anyone for pulled chicken?

Pulling chicks

Pulled pork has gone from being a US barbecue secret to a regular on supermarket shelves. Now KFC is trying to tempt us with a chicken version
9 best steam generator irons

9 best steam generator irons

To get through your ironing as swiftly as possible, invest in one of these efficient gadgets
England v Norway: Wayne Rooney admits England must ‘put on a show’ to regain faith

Rooney admits England must ‘put on a show’ to regain faith

New captain vows side will deliver for small Wembley crowd
‘We knew he was something special:’ Radamel Falcao's journey from teenage debutant to Manchester United's star signing

‘We knew he was something special’

Radamel Falcao's journey from teenage debutant to Manchester United's star signing
'I’ll tell you what I would not serve - lamb and potatoes': US ambassador hits out at stodgy British food served at diplomatic dinners

'I’ll tell you what I would not serve - lamb and potatoes'

US ambassador hits out at stodgy British food
Radio Times female powerlist: A 'revolution' in TV gender roles

A 'revolution' in TV gender roles

Inside the Radio Times female powerlist
Endgame: James Frey's literary treasure hunt

James Frey's literary treasure hunt

Riddling trilogy could net you $3m
Fitbit: Because the tingle feels so good

Fitbit: Because the tingle feels so good

What David Sedaris learnt about the world from his fitness tracker
Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Saudis risk new Muslim division with proposal to move Mohamed’s tomb

Second-holiest site in Islam attracts millions of pilgrims each year
Alexander Fury: The designer names to look for at fashion week this season

The big names to look for this fashion week

This week, designers begin to show their spring 2015 collections in New York