Banks accused of failing most vulnerable customers

Banks accused of failing most vulnerable customersImage source, Getty ImagesByKevin PeacheyCost of living correspondentPublishedJust nowSome of the UK's biggest banks have been failing their most vulnerable customers, according to the financial regulator.Banks have been pushing homeless people or those in financial hardship towards unsuitable online applications and away from basic bank accounts.These accounts are free, do not include an overdraft facility, and provide essential banking for those unable to open a mainstream account.Now, the nine UK banks and building societies which operate basic bank accounts have agreed to demands from the Financial Conduct Authority (FCA) to make access more straightforward.Basic bank accounts have many of the same functions as a regular current account, but are designed for those who might otherwise be excluded from the banking system. More than four million people in the UK have these accounts.They are offered by Barclays, The Co-operative Bank, HSBC, Lloyds Banking Group (including the Halifax and Bank of Scotland brands), Nationwide Building Society, NatWest (including the RBS and Ulster Bank brands), Santander, TSB and Virgin Money.Features include:accepting payments such as wages and benefits, and allowing account-holders to make payments through debit cards, direct debits and standing ordersfree, but with no overdraft facilityavailable to those who have a bad credit history, are bankrupt or have an official debt recovery plansome access for homeless people, by working with charities to confirm someone's identityBut a mystery shopping exercise by the FCA rated a third of experiences with basic bank accounts as poor or very poor.The exercise covered 298 interactions across branches and by telephone, and rated 28% of cases as good or very good, 38% as fair, 20% as poor and 14% as very poor.Problems included failing to offer these accounts to people who needed them, particularly those with no fixed address. Some push...