Co-op no longer offer accounts to undischarged bankrupts

The Co-operative bank have today announced that they will no longer offer accounts to undischarged Bankrupts. They say they have taken this decision because there is an "un-level playing field" in the market at the moment. Existing customer will not be affected by the change. This then leave Barclays as the only bank that offers a basic banking service to those who have not yet been discharged from their bankruptcy. The important distinction to be made here is that this move affects undischarged bankrupts. If you have been discharged then there are about 20 different providers who will supply you with the basic bank account without a monthly fee, some do come with a debit card though none have an overdraft, but if you are yet to be discharged then up to today only Co-op and Barclays would have offered you such an account. A statement from the Co-op announcing this decision indicated their frustration that give their relatively small branch network size they seemed to be taking on a disproportionate amount of these basic bank accounts for undischarged Bankrupts, the implication being that this is unprofitable business and others should do their fair share of it, and for this reason they have been forced to withdraw from the market. While we wouldn't want to comment on the rights or wrongs of this, it is curious that only two banks have chosen to offer such an account. The Co-op currently has 330,000 such accounts and in the 12 months to June this year some 35,000 people were declared bankrupt in England and Wales. Whatever the reasons, the ultimate loser here is the undischarged bankrupt consumer who has now lost the right to choose and is now forced to open and account with Barclays. Arguably every bank should offer some sort of a service here as it seems odd that a client who is made Bankrupt and who was up to that point a customer of, say, NatWest is now forced to close their account and re-open another one with Barclays. As if there wasn't enough stress and paperwork to be dealt with when bankruptcy is declared this seems like a step that could easily be avoided. For further advice on dealing with debts and potentially applying for an IVA or bankruptcy procedures we can connect you with experienced and qualified Advisors. Either call us on 0845 1260350 or complete our Debt management enquiry form.