If you’re looking to open a bank account then the simplest account to open is a basic bank account. This page looks at the benefits you can expect from this type of account together with information on the alternatives if you’re unable to open a basic account.
Life without a bank account can be very difficult especially if you need to set up direct debits, pay utility bills or have your salary or benefits paid in.
Basic bank accounts are ideal for people who don’t want an overdraft (or can’t have one) or have a low credit score and may struggle to open a classic current account. You’ll need to be at least 16 to open a basic bank account, although for some banks the minimum age is 18.
A basic account will give you all the benefits of a typical current account but allows you to control your spending.
What do basic bank accounts offer?
Basic bank accounts are free to use and designed for people who don’t have a bank account and don’t qualify for a standard current account. They can be the first step towards opening a regular account later on.
They offer fewer services than a standard current account and they don’t offer any overdraft facilities. However, you will generally be able to:
Have your wages, benefits and other income paid into your account.
Pay in money and cheques for free (as long as they’re not in a foreign currency).
Take out money over the counter or from a cash machine.
Pay regular bills by direct debit or standing order.
Check account balances over the counter, at a cash machine or on your mobile.
Use a debit card to pay for things in shops and online.
Who offers fee-free bank accounts?
Any bank or building society can offer a fee-free basic bank account but since September 2016, the nine largest banks are required to offer them.
Choosing the right bank
Before you open an account there are some general things to think about:
Check that the cash machines you want to use regularly are free.
Find out if there is a local branch of your bank or building society, or a Post Office, where you can pay in money and check your account.
Check if there is a buffer zone that lets you take out a small amount, say £10, even when your account balance is low so you can still get money using a cash machine.
Alternatives
If you have tried but can’t open a basic bank account, you might need to look at alternative options. Although we can’t give financial advice, there are a few alternatives below, and you should seek independent financial advice from organisations such as CAB or the Money Advice Service, as they can help you decide what is best for you.
Post Office Card Account
If you can’t open a basic bank account, you could consider opening a Post Office card account, which is specifically designed for receiving benefits, state pensions and tax credits. However, you cannot receive wages into this account.
Credit Union Current Account (CUCA)
You could look at those credit unions which offer the CUCA.
CUCA’s have facilities for wages and benefits to paid directly into, and along with direct debit, standing order and bill payment facilities, members receive a full range of day-to-day banking services direct from their credit union. There is normally a small weekly charge (usually around £1 –£2) for a CUCA.
Credit unions can only open accounts for people who fall within the credit unions ‘common bond’. This is normally based on location. If applying while in prison, you will need to apply to one that covers where the prison is based. You may be able to find this out in the prison, or ask somebody to use www.findyourcreditunion.co.uk on your behalf.
Prepaid cards
These can be useful for people who have a record of fraud and have been refused by a main-stream bank. We have more information here.
Reasons for refusal
Record of fraud
All account providers reserve the right to reject applications from people who have a ‘record of fraud’ as a result of money laundering regulations. This does not mean anyone convicted of an offence that could be considered fraud cannot get an account. For example, banks would not usually decline an application from a person convicted of providing incorrect information when claiming benefits. Banks do not have access to criminal records, however they do have systems to detect applications from people who have a record of fraud against financial institutions, such as banks and insurers.
Undischarged bankrupts
Most banks also reserve the right to reject applications from people who are ‘undischarged bankrupts’. This is someone against whom a bankruptcy order has been made and who has not been discharged from bankruptcy (which usually happens 12 months after bankruptcy).
Can your basic bank account be closed?
Your bank or building society can close your fee-free basic bank accounts or move you onto a standard current account if you:
Give false or misleading information
Open another bank account in the UK
Regularly fail to meet the terms and conditions of the account
Don’t use your account for more than two years
Have used the account unlawfully or fraudulently or there are concerns you might use the account in this way.
How do you complain about the service you’ve received?
Mistakes can happen and, if you have a complaint about the service you receive, first contact your bank or building society to give them a chance to sort the problem out. They should look into your complaint and reply within eight weeks.
If you’re not satisfied with the response, you might be able to take your complaint to the Financial Ombudsman to see if they can help.
Discuss this with others
Read and share your experiences on our online forum.
Useful links
Below you will find links to useful websites relating to this page. More specific details (including addresses and telephone numbers) of some of the organisations listed below can be found here.
The aim of this page is to provide guidance for people looking to open a bank account with convictions who also have a history of fraud. It’s part of our information section on banking.
Why is this important?
Each bank has the right to determine which customers it offers a bank account to, and they have a duty to protect their existing customers and the wider economy from risks such as fraud, money laundering and the financing of terrorism.
All basic bank account providers may exclude people convicted of fraud. However, it is not clear whether ‘may’ means ‘they might’ or ‘may’ in this instance means ‘they have the ability to, so they will’. It’s important to know what information banks have access to about you and how they will use this when deciding whether to offer you a bank account.
What is classed as ‘fraud’?
There is no single definition of what is meant by the term ‘fraud’. However, any false representation, abuse of position or the prejudicing of someone’s rights for personal gain can be deemed as criminal activity and can therefore fall under the umbrella of fraud. Banks commonly share information when assessing potential risk and this would usually fall into one of the following 3 categories:
Convictions under the Fraud Act 2006
Fraud against financial institutions
Fraudulent benefit claims
What is CIFAS?
CIFAS (Credit Industry Fraud Avoidance System) is a not for profit membership association representing the private and public sectors and is dedicated to the prevention of fraud, including staff fraud and the identification of financial and related crime. It is not the only fraud detection agency which offers services in this area but it would appear to be the most visible.
Membership is open to organisations such as telecommunications, retail, customer service centres and financial services, who are able to identify fraud and are prepared to share fraud data with others through the CIFAS National Fraud Database and/or the Internal Fraud Database. At present these members are predominantly private sector organisations, however, public sector bodies may also share fraud data through CIFAS to prevent fraud. As a result CIFAS are able to provide a range of fraud prevention services to its members, including a fraud avoidance system.
What are their aims?
Build on crime prevention data sharing to encompass both the private and public sectors in the public interest
Protect the interests of CIFAS members from the actions of criminals by pooling information on fraud and the prevention of fraud
Ensure that innocent members of the public, who are victims of fraud, are not prejudiced by the misuse of their identities and documentation
How does CIFAS work?
CIFAS enables members to exchange the details of applications from individuals for products, services or employment which are considered to be fraudulent, because the information provided by the applicant fails verification checks. Members can also exchange information about accounts and services which are being fraudulently misused. An example of this would be fraudulent insurance claims. CIFAS members also exchange information about innocent victims of fraud to protect them from further fraud.
This exchange of information is usually made possible by a clause that you agree to when you make an application or a claim for goods and/or services which explain how your data may be used. CIFAS information is not used to assess your ability to obtain an account, product, facility, insurance policy, benefit or employment as it is not a credit reference agency, but is only used to prevent the possibility of further fraud taking place.
CIFAS members are required to operate effective in-house procedures to enable fraud or attempted fraud to be identified and classified. Basic information on each case is filed on the CIFAS database and this information is then transferred electronically to a number of participating agencies.
When a member searches the CIFAS database through one of the agencies, the member is made aware of the need to investigate by means of a flagged warning. The member is then required to conduct an investigation into the case and not just reject the application, as it may prove to be a genuine application.
Information held by CIFAS
If you have a warning on your file this does not mean that you have been blacklisted.
A CIFAS member that receives a CIFAS warning from the system is not allowed automatically to refuse an application or to close down a product or service because of such a warning. They are required to make further enquiries to confirm your personal identification details before making a decision. If they identify a fraud, they will normally not proceed with an application or may review a facility or employment.
However, there may be other reasons why your application may not be approved. For example, you may not meet the decision-making criteria. In the event of this happening you are entitled to ask the member why it is they have chosen to decline your facility. However, the member will normally be able to provide you with an explanation and provide you with details of any credit reference agencies or fraud prevention agencies which they have used.
How long does this information stay with CIFAS?
All CIFAS markers, other than Protective Registrations and Victim of Impersonation markers, last for 6 years and are not dependent on how long the fraud carries on for. If an individual is found to commit fraudulent conduct again after the initial instance has already been filed to the National Fraud Database, a new marker would be created by the member organisation the new instance was committed against, which would last for 6 years from the date of the new marker.
How does this relate to the data held by Credit Reference Agencies (CRAs)?
Credit Reference Agencies are companies licensed to operate by the Office of Fair Trading under the Consumer Credit Act. They make credit information data available to organisations that are either processing applications from consumers or managing their accounts. They typically hold details of the electoral roll, details of county court judgments for debt, bankruptcy information, details of previous searches made by organisations against their databases and details of individual accounts held by the consumer, highlighting any late payment history.
In order to obtain a copy of your credit file detailing your credit history you may make an application either online or by post to a credit reference agency, such as Equifax or Experian, who make a charge of £2 for this service. For more details on how to get a copy of your credit file, see the credit rating section of this site.
Obtaining a copy of your credit file will provide you with a better understanding of why a potential lender may have rejected your application.
CIFAS data relates solely to fraud and cannot be built into any credit scoring model that may be used by organisations and Credit Reference Agencies. CIFAS data is processed by a number of fraud prevention agencies who provide fraud prevention services to CIFAS Members.
Has this been linked with the terms of the Rehabilitation of Offenders Act?
CIFAS does not hold any criminal records data and the CIFAS National Fraud Database is entirely separate from any data relating to criminal records.
How do I find out what information CIFAS holds on me?
CIFAS information can only be viewed by its members. However, the Date Protection Act 1998 gives you the right to seek Subject Access to a copy of any data that the CIFAS hold about you in return for a statutory fee of up to £10.
How can I challenge a CIFAS warning?
You should write to the CIFAS member organisation who recorded the data as they are responsible for the accuracy of their data. When writing to them you should:
Ask for the matter to be registered formally as a complaint
Detail exactly what you are complaining about, giving a full explanation as to why you consider that the CIFAS warning is unwarranted
Enclose copies of all relevant documents to support your case
This request would then be processed and looked at in more detail. CIFAS members tend to have their own complaints procedure which should be explained to you when you contact them.
If you are unable to reach an agreement on your complaint, you should request confirmation in writing from the CIFAS member that the complaints procedure has been completed or exhausted. This is sometimes known as a “Final Response Letter”.
Only upon receipt of this letter you can make a request for CIFAS to investigate your complaint. CIFAS will contact the CIFAS member and review all the details of your complaint, however, they do not have the power to recommend financial awards, but they will confirm whether the CIFAS member adhered to the correct procedures.
The use of information by banks
How will a bank decide whether to refuse my application?
Each organisation will have its own policy or criteria that it uses to make its decisions.
If you have been declined for a product or service, then there are a number of reasons why your application may have been refused. It may possibly be due to information on your credit file or for reasons related to an organisation’s credit scoring systems or specific lending policy.
You have the right to ask the organisation for a manual review of your application and, if the organisation’s decision remains unchanged, they should be able to indicate to you their reason(s) for refusal. Although CIFAS information is not used as part of any credit scoring systems, organisations may refer to CIFAS data (among other data sources) during their application handling process.
If I’m rejected by a mainstream bank, what should I do?
There are a number of reasons why you may have been rejected and it may have nothing to do with fraud. If you have a copy of your CIFAS records and see no information on there, it is likely that you were refused for other reasons e.g. eligibility. In this situation you may try another bank.
However, if you have been refused on the basis of a record of fraud, there are some potential routes. These should not be seen as recommendations – these are simply a few providers that Unlock have been advised by their members who have been able to help in these situations.
Managed bank accounts
Managed bank accounts are often referred to as guaranteed accounts. In return for a monthly fee, managed bank account providers offer a type of high-street current account,
A prepaid card is not a bank account, but it works a bit like one and only allows you to spend money you’ve paid in. They don’t offer any overdraft facilities so don’t allow you to get into debt. You won’t need to pass a credit check and the card can be used to buy things in shops and withdraw cash.
We would normally only suggest that you look at a prepaid card if you have tried to open a basic bank account and have been unable to. They should generally only be used as a last resort, because:
Whereas basic bank accounts have no opening or monthly costs, most prepaid cards will ask you to pay a one-off application fee which can be up to £10. Some will also require a monthly fee which could be between £2-£5. The cost of using a prepaid card can quickly add up, so look carefully at the fees associated with the card before you take it out.
Pockit, which charge 99p for the initial cost of the card, and then a 99p monthly fee
Optimum, which charges £5 for the initial cost of the card, and then no monthly fee.
These cards will often also have charges for making simple transactions like withdrawing money from ATM machines.
Release from prison (and just after) can be a time of uncertainty and change and tying yourself to a monthly fee, and ongoing costs for making simple transactions, may not be wise at this time. If you find that you can’t keep us your monthly payments then this will impact on your credit rating and possibly your ability to get credit in the future.
Discuss this with others
Read and share your experiences on our online forum.
Useful links
Below you will find links to useful websites relating to this page. More specific details (including addresses and telephone numbers) of some of the organisations listed below can be found here.
Discuss your views and experiences with others on our online forum
Savings accounts and credit union accounts in prison
Introduction
Although much of the focus of Unlock’s work in prison has focused on improving access to basic banking pre-release, there are many people in prison for whom a basic bank account is not the right banking product, whether it be because of the amount of money involved, or the length of time until release.
This information provides details on two alternative options for people who fall into this group: savings accounts and credit unions.
Savings accounts
Prison policy suggests that if you acquire a large sum of savings whilst in prison (£500 or more), then you should transfer it to an external savings account where it can accumulate interest and be ready for you to access upon release. Your prison account does have a savings sub-account but it will not pay interest and you will not be able to access any money you put in it until your release.
The prison service is in support of people in prison utilising external savings accounts, however if you don’t already have one set up they can be difficult to open from inside prison. Banks often have different application processes for setting up savings accounts, and this may stop you from opening one due to the limitations of postal banking. The best thing to do would be to write to your existing banking provider and ask them if you are able to set up a savings account with them, and if so how to go about this. It could be as simple as filling out an additional form and returning it to the bank, or it could be a lengthy process involving several types of ID and additional proof of address, it all depends on the individual banking provider’s own procedures.
If it is not possible to set one up with your existing bank then you will need to try another banking provider. Also, banks will often have several different savings accounts that offer different rates of interest, levels of access to your money, minimum deposits, and various other services and restrictions. The best thing to do would be to ask your bank for details of their accounts and advice on which would best fit your financial situation.
Credit unions
Credit unions are a growing alternative to the big banks. They are financial organisations that are owned and controlled by their members. Unlike a bank, which works to make money for shareholders, if you join a credit union, it is working to benefit you.
Credit unions come in all shapes and sizes and each will have a slightly different set of products. In general they offer savings and great value loans plus they are local, ethical and know what their members want. Many credit unions now offer a range of services including a current account, benefits direct, ISAs and Child Trust Funds.
Each credit union has a “common bond” which determines who can join it. This determines who can become a member of the credit union. The common bond may be for people living or working in the same area, people working for the same employer or people who belong to the same association, such as a church or trade union. You need to be aware that credit unions are still growing and it may well be that you cannot find one that you can join. If you are in a large city your chances will be a bit better.
As part of research that Unlock published in early 2013 (Unlocking Credit Unions) we found that a number of prisons had successfully partnered with local credit unions to offer savings accounts for people while in prison.
There is no general rule that prevents people with convictions from opening a bank account. It’s often that people have difficulties because of other reasons, not specifically because of their convictions. For example, many banks refuse applications due to:
All account providers reserve the right to reject applications from people who have a ‘record of fraud’ as a result of money laundering regulations. This does not mean anyone convicted of an offence that could be considered fraud cannot get an account. For example, banks would not usually decline an application from a person convicted of providing incorrect information when claiming benefits. Banks do not have access to criminal records, however they do have systems to detect applications from people who have a record of fraud against financial institutions, such as banks and insurers. We have a specific section covering this issue in more detail.
Undischarged bankrupts
Most banks also reserve the right to reject applications from people who are ‘undischarged bankrupts’. This is someone against whom a bankruptcy order has been made and who has not been discharged from bankruptcy (which usually happens 12 months after bankruptcy).
Poor credit rating
These days lots of people have a less than perfect credit record. This can cause problems when you apply for a standard current account because they tend to include credit facilities (like overdrafts, cheques and credit cards). Over two million people in the UK have opened basic bank accounts for this reason. They are easier to set up because most of them do not require a good credit record.
Disclosing your convictions
The bank account applications we have seen do not ask about criminal convictions and the banks do not request information about past convictions in any other way.
The banks have a system for detecting if you have convictions for defrauding financial institutions such as other banks and insurers. Other convictions do not seem to be an issue. If you are asked, convictions that are spent under the Rehabilitation of Offenders Act certainly do not have to be disclosed.
There can sometimes be an issue if there was high-profile media coverage of your convictions. Sometimes, banks will link media reports to their customer database. If this happens to you, depending on the response of the bank, you may want to make a complaint to the Financial Ombudsman.
Hints & tips
Be a confident consumer
Give yourself credit – you are a potential customer! Go to the bank and ask for help. If the branch staff are unhelpful, go to the manager. If the manager is unhelpful, ask to speak to a more senior one. If that one is unhelpful, try another bank – you do not want your money with an unhelpful bank anyway.
Look for support
Ask for support from other agencies. If you have been discharged from prison, can you get into contact with your resettlement team? Do you have a Probation Officer? A letter of support from these Government employees may be accepted as a piece of ID. If you do not feel you have any support from them, are there any local charities that can help you? Many areas have a Citizens Advice Bureau (CAB) which may be able to help.
Speak to your MP
It’s amazing what a difference it can make to a bank when an MP writes to them on your behalf. It is sad to say but it’s still the case that House of Commons headed paper counts for more than your notepad.
Try an alternative
Credit unions are a fast growing, community-led alternative to the big banks. Click here for more information.
Managing an external bank account while in prison
Introduction
Who is this aimed at?
This information is aimed at people who are currently serving a prison sentence. However, it should also be of use to families, friends, and anyone working with people in prison. It has been produced by Unlock in partnership with Transact, the National Forum for Financial Inclusion (which is a partner charity of Toynbee Hall).
What does it contain?
It provides detailed information about how to manage a bank account while in prison. It sits alongside broader information on opening a basic bank account in prison and in the community, as well information on opening savings and credit union accounts.
It is important to note that each banking provider has their own policies, processes, and procedures in relation to many of the issues discussed in this document. Consequently, we could not produce a completely comprehensive guidance that covers specifically how each bank handles every subject looked at. If you cannot find the exact information you are after then you should speak directly with the banking provider you have your account with to find out more.
Why is it needed?
There is currently no concise and user-friendly document detailing how people in prison can manage a bank account. Existing official information is a mixture of Prison Service Rules, Prison Service Instructions, and policy guidance. This has left many specific questions unanswered, which we aim to cover in this guide.
Why is Unlock producing it?
Unlock is currently working with HMPPS and the banking industry to increase the ability of people in prison to apply for, and open, a bank account before their release. The outcome of this work so far has been that an increasing number of people in prison have a bank account that can theoretically be operated before release. It is therefore important that people in prison, as well as those who work with them, are aware of how to manage an account whilst in prison.
In undertaking this work, we have identified a number of barriers that unnecessarily prevent people in prison from managing their banking and finances. We plan to take these issues forward by working with HMPPS, the banking industry, and other agencies, to try to improve the accessibility of accounts from inside prison.
The status of your bank account
Nothing happens to an external bank account as an automatic consequence of being in prison.
However, there are several things that could block access to your account, either temporarily or permanently. These are detailed below so that you can check to see if any of them could affect your ability to utilise your account.
Restraint Order
A Restraint Order is used to freeze the assets of a person to whom there is reasonable cause to believe has benefited financially from criminal activity. Restraint Orders are often given to someone suspected of fraud, money laundering, or serious drug offences. Someone subject to such an order will have all their financial assets frozen so that they cannot be used before any potential confiscation hearings (see below). Frozen assets cannot be accessed or transferred. For example, the order prevents the selling of property. As part of the order all bank accounts will be frozen with only a small amount of money being accessible for living expenses where appropriate.
Confiscation Order
A Confiscation Order is made after a person is actually convicted of an offence that resulted in a personal financial gain. The purpose of a confiscation order is to take away this financial gain. The court will determine the amount of profit received by the defendant and the amount of available financial assets the defendant currently has. The court will then order the defendant to pay the lesser of the two amounts. A Restraint Order will be in place from the start of a confiscation investigation until it is resolved; at this point accounts will be unfrozen and access to any remaining money will be given as above.
Third Party Debt Order
If you are in debt then a creditor can take you to court and obtain a court order against you, requiring you to pay them back. If you don’t keep to the terms of the order then your creditor will have several options, one of which is a Third Party Debt Order, which will allow them to take money directly from your bank account.
The first step a creditor will take is to get an Interim Third Party Debt Order. This order will get your bank to freeze the money in any accounts you have with them, up to the amount you owe. You will not be able to access this money, nor will any be paid to your creditor, until the court has made a final decision on the case. If the court finds the creditor to be right about the money owed then it will be taken from your account and given to them. If however the claim is found to be false then your money will be unfrozen and you will gain full access to it again.
If you are currently in debt then we recommend that you take immediate action to deal with it straight away so that you do not lose access to your money through things such as Third Party Debt Orders. You will need to seek independent debt advice so that you can explore the options open to you.
Account dormancy
Banks will sometimes suspend and restrict accounts that are inactive for long periods of time; this is called account dormancy. Any money in a dormant account will remain there and you will be able to reactivate the account and gain access to your money.
While an account is dormant you will not be able to use the money it contains or make any transactions relating to the account.
Banks only make accounts dormant when they have been completely inactive for a set period of time. This varies widely depending on the type of account and the respective banks policy on the matter; it could however be as little as a year for some current accounts. Your bank will try to contact you once this time period has elapsed; if they cannot get hold of you due to having the wrong correspondence details then they will make the account dormant. In 2009, legislation came into force allowing the Government to take money that had been untouched for 15 years to use it for good causes, although it has promised you can still reclaim it if you can track down any money that is rightfully yours. Many people don’t know if they’ve got a dormant account, but the easiest way to find out is to use a free central website, www.mylostaccount.org.uk. Be patient though; the search can take up to three months.
Avoiding dormancy is very simple. Make sure that your bank has your current prison address (see below for more details on this), and try to actively use it, even if this is only making a small deposit from your internal prison account once every 6 months or so. This will show the bank that it is being used and should stay active.
If your account has become dormant you will need to contact your bank to find out how to reactivate it as the process varies widely from bank to bank. For example, Halifax requires you to visit a local branch and prove your identity face to face (which will be difficult to do while in prison), whereas Barclays only requires you to make a debit or credit entry to the account for it to be automatically reactivated.
Control of your account
It is your responsibility to manage your account and any financial commitments associated with it whilst you are in prison. This section explains how you can utilise your account and details any banking limitations that will have been put in place by the prison service. There is an alternative to managing the account yourself; it’s called a Third Party Mandate.
Third Party Mandates
A Third Party Mandate will allow someone you trust to operate your account from outside the prison on your behalf. You can set limitations on what the holder of the mandate can do, for example make payments, issuing cheques on your behalf, etc. It will not remove your own ability to use the account but will simply give additional access to someone who is not in prison and doesn’t face the same restrictions as you. It’s also free of charge and is usually a relatively simple process.
Obtaining a Third Party Mandate varies from bank to bank so you will need to write to your bank and ask them to send you application details. Usually the process consists of filling out a form with sections for both yourself and the third party to fill in which will then need to be sent to the bank along with proof of the third party’s identity. Unfortunately not all banks allow applications by post and require the account holder and the third party to visit a local branch to verify their identity in person. If your bank requires this then it is unlikely that you will be able to set this up while you are in prison.
Communicating with your bank
Communication limitations
Telephone and Internet banking are not allowed while you are in prison. As a result you will have to conduct all of your banking activities by post. Most banks can operate in this way, but you will be limited in the number of services available to you, depending on the bank you are with.
Changing your address
There is no legal requirement for you to notify your bank that you are in prison, however changing your address is an important first step in managing your account as it will protect you from dormancy and enable your bank to keep you informed of any important information. For example, if your bank sends you a statement to the address they hold on file and it gets returned to sender, your account is likely to have restrictions put on it. To update your address you will need to contact your bank and ask them to send you a change of address form.
The form will ask you for proof of your identity. Some banks will only need a signature from you to prove your identity, as they will then match it with the copy of your signature they took when you first signed up for the account. If the bank requires additional proof of identity then they might accept the prison template used to apply to open a new account. Please see the separate section on proving your identity for more information.
Banks will often ask for proof of address as well as identity. This will usually be asked for in the form of something you cannot obtain, such as a council tax or utilities bill, therefore you will need to get a letter from the Governor of the prison to confirm your current prison address. You may need to request that this letter detail specific information depending on what you are being asked to confirm, such as what date you first came in to the prison, when you are due for release, etc. Alternatively, you may find that a letter from your solicitor is sufficient.
Prison number
To make sure that any correspondence the bank sends you reaches you successfully it is important that you inform them of your prison number and ask that they include it on anything that they send you. Post that does not include your prison number could be delayed in getting to you and may sometimes be returned if the post room cannot identify who the post is for (for example, the prison may be holding, or recently have held, more than one “P. Smith”).
Bank statements
As long as your bank has your prison number and current address you should continue to receive any statements you would have previously received at your address prior to being sent to prison. You may choose to contact your bank and opt not to receive paper statements if you don’t want these sent to the prison.
Privacy
The prison authorities have the right to open and examine any incoming or outgoing post for security purposes, as well as the right to intercept and monitor telephone calls. As a result, communications between yourself and your bank cannot be guaranteed to remain confidential. This includes bank statements because they are not regarded as being confidential even if they have specific markings such as ‘Private’, ’Private and Confidential’, or ‘Confidential‘ marked on them.
Account items
Bank cards, PIN’s and cheques books
Any bank cards, PIN’s and cheque books must be kept in your valuable property, unless you’ve taken out a Third Party Mandate, in which case it would generally be best for these to be with the holder of the mandate. You will not need to access your card while in prison, however you may need to send cheques on occasion.
In order to access and issue a cheque you will need to go through the appropriate application process. The Governor will need to be satisfied that any transaction you are making is for a legitimate purpose and does not break any security protocols. You will need to fill out a general application detailing why you want to write a cheque and who it is for. If this is approved then you will have to fill out the cheque with a witnessing officer present to make sure it is done in accordance with the details given on the approved application.
Banking restrictions
People on remand
If you are on remand there are no restrictions on the types of banking transaction you can make. You can continue to make any personal or business transactions that you would ordinarily make. However, no special provisions will be made for you. As a result, as detailed above, banking correspondence can be monitored by prison authorities and you will be limited to postal communication only. Also, if you wish to make a substantial cash or property transaction the Governor has the right to consult the police.
The following sections relate to people who are convicted.
Business transactions
You are not allowed to conduct business transactions whilst in prison. A business transaction is one that is liable to take place more than once, or on a regular basis, and does not count as a necessary personal financial transaction (see below). However, once convicted you should be given a reasonable amount of time to settle current business transactions or to hand them over to someone else to manage on your behalf.
Personal transactions
You are restricted to making banking transactions of a personal nature that must fit into one of the following categories:
Help you to maintain your personal affairs whilst in prison.
Help assist you to resume a regular lifestyle on release.
These include:
Making payments to reduce an outstanding balance or other debt re-payment.
The sale, transfer, or disposal of personal property and shares.
The transfer of personal funds, where appropriate.
The ability to issue cheques, where appropriate.
If you have any queries about the legitimacy of a specific transaction that you want to make then you should submit a general application to the Governor to ensure you are not inadvertently breaking any rules.
Credit cards, loans and credit agreements
You are not allowed to use credit cards or enter into any form of loan or credit agreement whilst in prison. Examples include loans from a bank or credit union, mobile phone contracts, insurance paid by direct debit, and mail order catalogues offering credit (although a single installment or one-off payment may be issued on your behalf to purchase a large item, at the discretion of the Governor).
Existing financial commitments
You will need to ensure you have enough money in an existing bank account to meet any ongoing financial commitments that you have, such as loans or a phone contract. If you do not keep up with payments then you are likely to incur charges and potentially damage your credit rating. If you are worried that you do not have enough money in your account and are at risk of falling into debt then you should make contact with debt advice organisations.
Standing orders and direct debits
It is important when you first come into prison that you arrange for any standing orders and direct debits that you can no longer afford to pay to be cancelled, or transferred, to avoid you incurring any unnecessary debt. It is important for you to write to your bank as soon as possible to instruct them to cancel these.
Usually the bank will only need a letter requesting cancellation of a direct debit or standing order, however if on receiving a request from you they need more information they will let you know and may send you an additional form for you to fill in. When requesting a cancellation make sure to include as much information as you can. Most importantly include the name of the company or organisation that the standing order/direct debit is paid to (banks often call this the originator).
As well as contacting your bank it is also vital that you let the originator know that you are cancelling payments to them and your reasons why.
Transferring money
Electronic transfers
There is currently no way to transfer money electronically whilst you are in prison. This is true regarding both the transfer of money from an external account into your prison account, and vice versa, from your prison account into an external one. As a result, you will need to follow the procedures detailed below in order to move money between your accounts.
Transferring money from your external bank account into your prison account
The established process for transferring funds from an external bank account to a prison account requires you to write a cheque made payable to the Governor, which the prison then transfers to your prison account. Commonly cheques are made payable to ‘The Governor, HMP _____’.
Cheques will, as a minimum, be banked on a weekly basis. Post-dated cheques will not be accepted. Transferring money in this way has been known to trigger a SIR (Security Information Report) but this will not stop the money getting through to your account, but may delay the transfer. As long as the money being transferred is deemed to be for legitimate personal use only by the prison then it will be allowed.
However, basic bank accounts, and many current accounts, do not provide a chequebook. If this applies to your account then it will not be possible to transfer money into your prison account from your external account, unless you have a Third Party Mandate allowing someone outside the prison to transfer money in on your behalf.
Transferring money from your prison account into your external account
In order to make a transfer into an external account from your prison account you will need to fill out a Cash Disbursement Form. You will need to include your bank account number and sort code on this form so make sure that you have this information available to you when making this kind of transfer.
Setting up a standing order
It may be possible for you to set up a standing order whilst in prison. This will only be possible on rare occasions that fit into the personal transaction categories detailed above, such as setting up a regular payment to a creditor.
Not all banks will allow you to set up standing orders by post alone. You will need to write to your bank to check and ask what the procedure for application by post is. Usually this will be a specific form that the bank will send you, or it may be enough to send a simple written request containing the following information about the account the money is to be paid into: Bank sort code, account name, account number, payment amount, payment date and frequency, and any end date you wish to put on the payments.
Release from prison
Valuable items
All bankcards, PIN’s, chequebooks, and other valuable banking items that are held by the prison should be issued to you at reception immediately prior to you leaving the prison. If the property cannot be accessed before release you can return to the establishment to collect it. Alternatively the cashier should make arrangements to send it to you by recorded delivery on the next working day.
Changing your address on release from prison
As soon as possible after your release you should notify your bank that you have changed address, otherwise the bank will continue to send any correspondence to the prison. Whilst the prison should forward any post on to your future address this will cause a delay in you receiving potentially important financial information and should be avoided if possible.
Opening a basic bank account before release
Please note – This page contains our self-help information for people with convictions.
Unlock ran a 9-year project, working with prisons and the banking industry, to better develop links in prisons. This came to an end in early 2014. Details of this work, and an impact report we produced, are available here.
Introduction
Research suggests that between one third and one half of people in prison don’t have a bank account. Getting it sorted after release can be a humiliating experience, so people need to try to open a bank account before they leave prison. It’s a fundamental necessity of modern life and therefore resettlement. You need one just to claim JSA, and to receive wages from work you do.
Getting the banks to agree has been a slow process. In 2005, only one responded to Unlock’s call. Now, all the major banks are involved in opening accounts for people in prison. Each bank has ‘adopted’ a number of prisons, allowing over 100 prisons to support account applications using a standard ID template.
It’s not perfect. Prisons don’t always make it available to everyone and some prisons don’t make use of the arrangement they have in place. It’s focused on basic bank accounts for people preparing for release. Most of the banks try to avoid ‘dormant’ accounts by excluding people who don’t have a release date.
This information will cover how you can go about applying to open a basic bank account before you are released.
Prisons and banks
The rules
There is no specific rule (either within prison or within the banking industry) that stops you from opening a bank account whilst you are in prison. Banks can open an account for you and rely on the prison’s security systems to ensure that only activity that the prison feels is appropriate is carried out on the account. Prison regulations set out a number of conditions that apply when opening a bank account:
You will give the prison as your address.
Authorised staff from the establishment will be able to inspect your financial records at any time.
You will not be allowed to open or operate accounts that offer credit facilities.
You will not be allowed to open or use store/credit cards, or other credit facilities.
Cash, bank/building society books and cheques will not be allowed in your possession within the establishment.
The approach of banks
People in prison who apply to a local bank branch near to the prison often find the attitude of staff unhelpful. Although there are no specific rules that prevent the bank from opening an account for somebody in prison, they usually refuse. This can be for a variety of reasons; they may not have been trained to deal with applications from people in prison or they may think they are taking a risk. At a more senior level, some banks are worried about risking their profits and their image.
Unlock has been working hard to make banks aware of how important it is for people in prison to be able to open an account before release, and how difficult it is for people to actually do so. It is not an easy task, but most banks have taken notice. We’ve worked hard on behalf of people in prison to overcome the fears banks have, which lead to this discrimination. The arrangements that we have set up have shown that people who have previously been in prison can become excellent bank customers.
The approach of prisons
The Prison Service is officially supportive of people in prison opening bank accounts:
‘Imprisonment provides a good opportunity to assist offenders to open bank accounts and thus be better prepared for life after release. It is, therefore, advantageous for prisoners to open bank accounts and establishments should assist them to do so.’ Paragraph 1.5 of PSI 44/2011 Identity (ID) for Bank Account Applications for all prisoners
Prison staff should provide ‘reasonable support to enable [a person in prison] to open an account.’ National Offender Management Service, quoted in Inside Time in February 2008
‘If a prisoner […] acquires cash exceeding £500 they should be advised that it is in their interest to transfer the excess to an external account.’ Paragraph 3.2 of PSI 01/2012 – Manage Prisoner Finance. Note: There is no rule preventing people with less than £500 from opening an account
Basic bank accounts
In applying for an account before release, a basic bank account is the type of account that you should be looking at applying to open. We have separate information about what basic bank accounts offer. We also have separate information onsavings and credit union accounts.
Applying for a basic bank account – the options
Option 1 – Specific prison/bank arrangement
Check to see if there is a specific banking arrangement running in your prison. These arrangements make the process of getting an account much simpler. They usually take account of the specific needs of people in prison; for example, they can help people who do not have any ID.
Make sure you try a few places in the prison, just because one person says there is no arrangement, this doesn’t mean that there isn’t one. Ask your personal officer if you have one, education, resettlement, and any relevant charities such as CAB. A list of currently active banking arrangements can be found at the end of this information.
If there is an arrangement, check whether you are eligible or not as some prioritise people who are near the end of their sentence. If you are eligible, ask to be added to the list.
See the bottom of this page for more information.
Option 2 – Apply to the bank of your choice
If the prison doesn’t have a specific arrangement, or even if it does (and it’s just that you want to apply to a different bank), there are no rules to say that you can’t apply to other banks. The first step is to write to the banks that you wish to open an account with. Attitudes vary between branches, not just banks, so it is not possible to recommend any specific bank. Success seems to depend on how you go about it, whether you have money to put in, the types of ID you have, how persistent you are, and who receives the application.
It will help if you can get a list of banks that are local to your prison. Ask resettlement staff to help you get this. Check with prison staff to find out whether they have already built up a relationship with a specific branch nearby. Remember you can always change your bank at a later date.
Next, write a standard letter and send it to each bank. In your letter you might like to:
Explain that you are in prison (there is no need to discuss your offences).
Explain that you are about to be resettled back into the community.
Give a rough estimate of your expected release date.
Explain that that you need a bank account to secure employment and benefits after your release.
Inform them that you are intending to use the account actively once released.
Explain what types of ID you have (you can ask the prison to complete the template if you’re struggling with other forms of ID).
Be aware that, in our experience, letters from people are sometimes simply ignored by banks, so you will need to be persistent.
Option 3 – Wait until release
If there is no specific arrangement running in your prison, and you are close to release, you should consider spending your remaining time preparing to open one after release. Focus on getting together any ID that you have.
Joint accounts
Existing prison banking arrangements have only allowed applications in sole name. There is currently no NOMS policy on joint applications, and these have not been proactively supported for a number of reasons; such as difficulties in governing financial transactions by people in prison, difficulties with two account holders with different addresses, and the possibility of two people in the same prison wanting to open a joint account together. Furthermore, banks have only allowed individual applications in order to reduce risk.
If you would like to open a joint account you should instead look to add a partner to your account after release. You should also be aware of the implications of a joint account and understand that money in the account can be spent without your permission.
If you’re looking to find out the details of arrangements in a specific prison, we’d suggest you ask the prison directly in the first instance.
If you’re still struggling to find out the details, you can email offenderbanking@noms.gsi.gov.uk – this should put you in contact with the lead at HMPPS (which oversees the prison-banking arrangements) who should be able to provide you with details of specific arrangements for specific prisons.
This page is mainly designed for use when applying to open a basic bank account and is part of our information on banking. We have some general information on why you are likely to need identification and the different types that are available on our sources of identification page.
Why is this important?
For many people in prison and on release, the biggest problem when applying for a bank account is providing identification. Even if the bank is happy to open an account for you, you will still need to meet the individual bank’s identification requirements. This is usually one piece to prove your name, and a different piece to prove your address. This can sometimes be difficult (and expensive) for you to find.
General guidance
Banks have their own long lists of acceptable ID (see below). These allow them to be quite flexible, despite what some branch staff will say. They normally have this list on their website, so if you get told by a branch that they don’t accept a particular document, ask them to check their long list of ID.
Banks have different policies. You can’t force them into accepting a particular document.
There may well be other documents that your local bank will accept, even though they are not on the list below.
If you’re relying on a prison or probation letter, get a copy of the Joint Money Laundering Steering Group (JMLSG) guidance (print the front cover and the relevant page) and show it to the bank.
Banks often require at least two pieces of ID so remember that the same document cannot be used for both name and address. Some banks require more than two pieces of ID documentation.
Don’t tall into the trap of thinking that you must spent lots of money buying a passport to prove your identity. Ask your bank branch – it may accept a benefit letter, birth certificate or probation officers letter. If you know your National Insurance number you can write to your local Tax Office. Even if you have never paid a penny in tax, it will write back to you, providing proof of address.
Proving your identity while in prison
Ideally you will be able to get standard forms of ID, (see Long list of possible ID below). If you don’t currently have any ID it is worth trying to get some.
As part of our banking project, we helped to partly overcome the ID problem by creating a special ID form, signed by the Governor, to prove who you are. This form has now been included as a template so all people in prison can use it. This ID form has been established specifically for opening basic bank accounts. It has been agreed by all of the banks through the British Bankers Association and the Joint Money Laundering Steering Group that this form can be accepted as the only form of ID when opening a basic bank account. More details on the form and how the prison should use it are contained in PSI 44/2011.
You should be able to get this PSI from the Prison Library and the ID document will need to be completed by a member of the Prison Service and signed by a Governor. The British Bankers Association has agreed on the ID document so it is officially acceptable; however when it comes to individual bank branches they can still refuse to accept your application. If the ID document is rejected as a form of ID it may be useful to respond quoting the Joint Money Laundering Steering Group (JMLSG) guidance which says that banks can accept it for a basic account. (see Banking guidance below).
Proving your identity in the community
If you have a Probation Officer, you may be able to use a letter from them as a form of ID (see the banking guidance section below). If you have been released from prison, a letter signed by the Governor (or the PSI document) will no longer be useful as it could only be used while you were at the prison address.
Otherwise, you will need to explore other ways in getting some of the forms of ID listed in the ID Guide below. For example, there may be a project in your area that helps people with convictions to get into work where they may be able to help with the cost of ID to help get a bank account for your wages to be paid into.
Banks also have their own long lists of acceptable ID. These allow them to be quite flexible, despite what some branch staff will say. Banks often require at least two pieces of ID so remember that the same document cannot be used for both name and address. Some banks may require more than two pieces of ID documentation. Please remember that different banks have different policies and nobody can force them into accepting a particular document as acceptable ID. Please also remember that there may well be other documents that your local bank will accept even though they are not on the list. If you manage to open an account with a different document please let us know so we can share this information with others.
Banking guidance
Through the BBA (British Bankers Association) and the JMLSG (Joint Money Laundering Steering Group) the banking industry has signed up to accepting certain identity for basic bank account applicants in certain situations.
For people in prison
“It may be possible to apply standard identification procedures. Otherwise, a letter from the governor of the prison, or, if the applicant has been released, from a police or probation officer or hostel manager would normally be sufficient. See the pro forma agreed for this purpose with the National Offender Management Service and UNLOCK, attached as Annex 1-III” – This is taken from Part II of guidance from the Joint Money Laundering Steering Group, available here (see page 13)
For people on probation
“It may be possible to apply standard identification procedures. Otherwise, a letter from the customer’s probation officer, or a hostel manager, would normally be sufficient” – This is taken from Part II of guidance from the Joint Money Laundering Steering Group, available here (see page 13)
Long list of possible ID
Discuss this with others
Read and share your experiences on our online forum.
Below you will find links to useful websites relating to this page. More specific details (including addresses and telephone numbers) of some of the organisations listed below can be found here.
Financial Ombudsman – The UK’s official expert in helping individuals sort out problems with banks, insurances, pensions etc.
ID Guide: How to prove your identity has been published by Toynbee Hall and Transact as a guide to identification. It includes 57 types of identification, what you can use them for, where to get them, how long they take to get, and how much they cost.
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