Home Business News RBS and Lloyds prevent customers from using rivals' cash points

RBS and Lloyds prevent customers from using rivals' cash points

by LLB Editor
10th Oct 11 11:57 am

Royal Bank of Scotland and Lloyds Banking Group have come under fire for blocking basic account customers from using rivals’ cash machines.

RBS customers can now only use machines at NatWest, the Post Office, and supermarkets Tesco and Morrisons.

The influential Treasury Select Committee of the UK House of Commons has written to the chiefs of both banks to demand an explanation for their policy, which would exclude basic bank account customers from the majority of the UK’s free cash machine network. Basic bank accounts offer current-account banking services to people with poor credit history, without overdraft facilities.

In a letter to the banks, Committee chairman Andrew Tyrie wrote: “Your decision has major implications for access to universal banking customers and appears to target vulnerable customers who are most at risk of financial exclusion.”

RBS in August announced it would limit access, while Lloyds already has restrictions in place, Tyrie said.

In a reply to the letter, Brian Hartzer, head of RBS’s retail operation in the UK said the bank pays a charge every time a customer checks a balance or makes a withdrawal at a rival cash machine.

As a result it loses money on its basic accounts service, “which we need to reduce”, he said.

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