The press release issued by HM Treasury on 2 October 2023.
Changes to the rules which determine whether a bank can operate – known as Threshold Conditions – will ensure banks are upholding their current legal duties to protect freedom of speech.
- Chancellor spells out new rules for banks to protect free speech
- banks forced to show exactly how they are protecting customers’ freedom of speech under a shakeup of the rules
- banks must take existing obligations not to discriminate seriously
This action will give regulators the green light to take firm action if any bank is found to undermine or fails to protect the rights of their customers.
A public consultation will be launched shortly to consider how these changes are best delivered, before legislating next year, as part of the government’s aim to put an end to de-banking for freedom of speech reasons.
This follows concerning reports that highlighted situations where banks may have been closing the bank accounts of customers based on their political views.
The Chancellor was quick to act – confirming new rules will force banks to delay and explain account closures and asking the FCA to conduct a deep dive into this issue.
The notice period for payment service framework contract terminations is to increase from two months to 90 days, and banks will be required to give customers clear and tailored explanations for why they had closed an account – unless in limited cases such as where this would be unlawful.