The closure of Ulster Bank and KBC Bank could leave thousands in financial limbo
The closures of Ulster bank and KBC Bank Ireland means hundreds of thousands of people will be left unbanked unless they act soon to find new providers.
There is enormous potential here for everything to go wrong.
A: Ulster Bank has started writing to its customers with current and deposit accounts, warning them to move or close their accounts. Customers don’t have to take any action until they receive a letter or email from him. It gives customers six months to find a new account and close their account.
KBC Bank current account customers only have 90 days to close their account. People who have current accounts at KBC Bank have been told that the accounts will be closed from June 1 next year.
Q: How do I switch my current account?
A: First select a new provider. Current account comparison services are available from the Competition and Consumer Protection Commission website, ccpc.ie and Bonkers.ie. Some providers don’t offer overdrafts, while others don’t offer mobile payments like FitBit Pay or Garmin Pay. Once you’ve decided on a new provider, get in touch to say you want to switch. The new provider will provide you with an exchange pack containing the information you need about your new bank.
You need to make an appointment with your new bank to start the switching process. This date should be a time of the month when your account is least active so you don’t miss any debits or payments. You will also need to provide your new bank with proof of identity and proof of address.
Update your employer or other people who pay money into your account (e.g. Social Security) with your new account details, as your new bank will not be able to do this for you.
You may need to contact any service provider you have set up a direct debit with to inform them of your new banking arrangements. This will probably take a lot of time.
When you shop online, your old card details are stored with several websites. Remember to update your banking details at any retailer you regularly shop at online.
Q: I would like to open a new joint account with my wife. What happens?
A: All major banks now allow you to open an account using your smartphone, so you don’t have to go to a branch or make an appointment. If you do not agree to this, you must make an appointment in a branch. Even if you want a joint account, you have to set it up in a branch. It is best to make an appointment in good time.
Q: What about overdrafts and credit cards?
A: Central bank rules require customers to complete a credit check with their new bank to obtain an overdraft or credit card. This means that customers with a new checking account will not automatically receive a credit card or overdraft facility.
And you’ll typically need to have a checking account with your new provider for about three months before you’re eligible for a credit card or overdraft facility.
Q: What if I don’t close my credit card account?
A: Ulster Bank say they will write to you later this year to give you six months’ notice before they close your credit card account. After the six-month notice period, your account will be closed and you will no longer be able to use your card. If you can’t pay the balance, you should continue to make repayments according to the terms of your credit card agreement, the bank says. “Failure to comply could have consequences for you, for example negative effects on your creditworthiness.”
For KBC customers, an agreement should be made with Bank of Ireland receive regulatory approval, credit card accounts may be transferred to the Bank of Ireland. If the account is transferred, the new provider can update the terms and conditions.
Q: Do I need to clear my overdraft?
A: When asked about customers with overdrafts, KBC said these customers are given 120 days’ notice to reflect the fact that they may have to go through an application process with another provider.
If a customer is unable to repay their overdraft, KBC said it will work with customers to find an individual solution to suit their circumstances.
It has around 7,000 customers with overdraft facilities for their checking accounts.
Ulster Bank says that account holders with an Ulster Bank overdraft who are unable to pay it must contact the bank to make arrangements with them if they are unable to pay the overdraft.
Q: What happens to vulnerable people who are not tech savvy?
A: Ulster Bank says it is establishing a dedicated customer phone number on 1800 656 001 “for people in vulnerable situations” 12 hours a day, seven days a week, as well as increasing staff in its vulnerable customer unit and ensuring trained staff are in place available at any of its 88 stateside locations.
Customers the bank knows are at risk are receiving calls offering support once the letters have been sent.
KBC Bank Ireland said additional support will be put in place for these customers, including extra coverage and communications, access to a dedicated phone line and unit for vulnerable customers, extensive additional staff training and guidance on how to support potentially vulnerable customers.
Q: What happens to my KBC mortgage?
A: KBC Bank is selling most of its mortgage accounts to Bank of Ireland, a transaction subject to regulatory approval.
Subject to regulatory approval, mortgages will be transferred to Bank of Ireland at a later date and should a customer account be transferred, that bank may update terms and conditions, KBC said.
Q: I get a discount on my KBC mortgage because I have a current account at the bank. What happens to it when Bank of Ireland buys the KBC Mortgage?
A: If the Bank of Ireland deal is approved by the authorities, your KBC Mortgage will be transferred to Bank of Ireland at a later date and your mortgage rebate will apply for as long as your mortgage remains with Bank of Ireland.
You do not need to open a current account with the Bank of Ireland to take advantage of the discount.
Q: What will happen to my Ulster Bank mortgage?
A: Ulster’s parent company, NatWest, has signed a binding agreement for Permanent TSB to acquire approximately €7.6 billion in untraceable mortgages and commercial loans from Ulster Bank.
The new owner will respect the clients’ existing terms, including mortgage rates and terms.
A separate sales process for around €6.5 billion of performance tracker mortgages is underway.
Regardless of who buys the Tracker mortgage book, the Tracker terms do not change.
Q: Can I switch my mortgage?
A: Even if your mortgage is sold, you can switch to another provider. Even if you have to pay a fractional fee, it might be worth switching as the home loan market here is now very competitive.
Q: What about savings accounts?
A: There is not much enthusiasm in the savings account system and the banks and credit unions are awash with deposits. Some credit unions have limits on the amount of savings they accept.
This means you now need to think about where you are going to transfer your savings to.
https://www.independent.ie/irish-news/ulster-bank-and-kbc-bank-closures-may-leave-thousands-in-financial-limbo-41568138.html The closure of Ulster Bank and KBC Bank could leave thousands in financial limbo