Nine of the biggest UK banks and building societies are legally mandated to offer basic bank accounts. They exist to serve people who may not otherwise be able to access standard current accounts - providing access to essential services with no fees and no overdraft. A mystery shopping exercise by the FCA found a third of experiences with basic bank accounts rated as poor or very poor. The mystery shop revealed that the bank account providers were not consistently offering these accounts to customers who could benefit from them. This included people facing financial hardship or without standard identification, and especially those with no fixed address. The firms often failed to mention basic bank accounts at all and pushed customers in vulnerable circumstances towards online applications unsuitable for their needs. To address this, the banks and building societies have agreed to individual improvement plans and we’ve worked with UK Finance to secure a collective commitment for the firms to: Provide the right account for customers, first time, with clear communication and minimal friction. Make it straightforward for customers without standard ID or a fixed address to open an account. Spot vulnerability early and offer accessible alternatives to online-only journeys. Emad Aladhal, director of retail banking at the FCA, said: 'Progress has been made with over 97% of UK adults having a current account, but our latest work shows that all too often banking firms’ engagement with customers still needs improvement. Bank accounts are important for financial inclusion, and this is about making sure the very people who could benefit from basic bank accounts are not missing out. 'That’s why the biggest banks have now committed to improving how they are offered – and we’ll be holding them to account to make sure change happens.'Peter Tyler, director of personal banking at UK Finance, said: 'A basic bank account can be an important first step towards financial independence, and while most customers who hold one have positive experiences, we recognise that more can be done to ensure consistently good outcomes for everyone. That is why UK Finance and our members are committed to raising industry standards and expanding access. 'The recently expanded Breaking the CycleLink is external initiative is a key part of this work, providing practical support to those facing barriers to accessing essential banking services, such as individuals without a fixed address' Steve Round, President and Co-Founder, SaaScada, comments: "The FCA's findings point to a wider issue: basic bank accounts are loss-making for banks on the infrastructure most of them run. They cost a lot to serve, generate little revenue, and the nine designated providers have to offer them anyway. Ultimately a third of interactions rated poor or very poor isn't a surprise. It's the pattern you'd expect for a product that loses money for the provider. Housebuilders negotiate down their affordable housing quotas for the same reason. The improvement plans agreed with the FCA will help, but until the economics of serving these customers change, the people who rely on fee-free banking will keep running into friction."NoYesBanking07 Jul, 2026