Group Urges Accounts For Bankrupts

• News
• Published: 12 Jul 2010 in Money and Current Accounts

People going through bankruptcy should be given access to a current account, according to a charity that has spoken out against increased exclusion for those unable to pay their debts.

Charity Citizens Advice said there is no legal justification for most bank refusing to let consumers with undischarged bankruptcy open even a basic bank account that does not have a credit facility.

Bankrupt people were offered basic accounts by just two of the 17 banks and building societies offering that service, said the charity.

The banks' stance increased financial exclusion for bankrupts and the body urged them to make the accounts more widely available. 

There was a 249% jump in the number of people going bankrupt between 2000 and 2009. 

The most common reason people gave for going bankrupt was that they had suffered an unexpected change in their circumstances, such as job loss, illness or an accident or relationship breakdown. 

Citizens Advice said denying bankrupts a basic account was demoralising and impractical, and made it very difficult for them to make a fresh start. 

Gillian Guy, chief executive of Citizens Advice, said: "Basic tasks such as receiving wages or benefits and paying bills can become huge and costly obstacles, particularly for people who are often at a vulnerable point."