Why is it so hard to open a bank account in the UK?
Banks may accept lesser degrees of checking to open a ‘basic bank account’, which will have no overdraft or cheque-book facility. Most banks offer these accounts, but they don’t tend to advertise them (presumably because they will make very little profit on them). There is a list of which accounts to ask for at the FSA again. Also, Proving Your Identity.
I had no problems opening a bank account in the UK. It was quick and painless and I’ve had no problems since then either (going on 6 years now). I am, however, a citizen of the European Union which means that any money I do ‘skip out’ on they can chase me down for with less problems than outside the EU, or at least this is how I’ve understood it.
This isn’t answering your question, but I thought I’d throw it in that while I was living in the UK, we (mostly Canadians and Americans coming to work in London) used to throw “I finally have a bank account” parties. For real. It was the most horrendous process we’ve ever been through. Interesting ideas as to why this is above – thanks for those. But the appalling customer service (or really, lack thereof, in the UK) seems to be a big part of this. One good friend of mine who had arrived with a salary of about £150,000, already had secured a year’s lease on a flat, had utility bills already paid, letters from employers, letters from his bank in Canada etc. and just wanted to open a savings account at Barclays was told within five minutes: You couldn’t possibly have this salary, we don’t believe the rest of your details, please leave. He opened up a savings account with another bank that afternoon. (Though it took a further two months to get a debit card.
Well, I for one am very happy with my UK bank account. The staff are generally helpful. The service is excellent and free. I get a pretty good rate of interest, even on my current account. I recently opened a third current account (a dummy to give to PayPal), and the whole process was totally painless.
I wonder if it has to do with where you’re trying to open the account in the first place? Most Americans moving here for work, for example, tend to cluster around places like London. The branches of my bank I’ve dealt with in London are very security, “forms in triplicate”, and ID conscious in a way that branches where I live (north of England) aren’t. When I went to open my account, I brought in a copy of my lease, my passport, and a job offer letter with me. That’s all it took. On the other hand, put yourself in the position of the wageslave at the bank’s customer service desk. You have someone approach you who says, essentially: “Hi, I am foreign, here for a while, but not necessarily for the long term. I have no credit in your country, so you have no idea of my spending habits, but I need an account with an overdraft and cash card attached. I keep asking questions about frequent international transfers, and I don’t have a national insurance number or any sort of way for you to know
