Most Ulster Bank and KBC customers have not yet closed their accounts with the banks, despite threats of frozen funds and canceled transactions for thousands as of today (Friday).
Just 38 percent of current and deposit accounts open at the two exiting banks earlier in the year had been closed by the end of October, according to new data released by the central bank.
Although the three remaining domestic retail banks opened 800,000 new accounts in the last 10 months – double the usual number – there are almost as many customers who have not yet migrated or closed.
The massive backlog and lengthy migration process threatens to delay banks’ planned exit from the Irish market and has become a bone of contention at the central bank.
Ulster Bank will start freezing the least active accounts from today after extending its deadline for the first wave of account closures by a month to speed up its exit process.
But central bank officials continue to insist that banks must comply with consumer protection standards during the “unprecedented” forced migration so that no one is left stranded without access to banking services.
“This account closure drill is one we have and will continue to review very closely as we have looked at each phase of the withdrawal to ensure the clear expectations we have set are being met,” a spokesman said in a statement.
“This includes in particular ensuring that no customer account is closed until all reasonable measures have been taken to ensure that the customer has been able to switch.”
Ulster Bank is now beginning a phased process of blocking account access for customers who were told in April and May they had six months to switch banks.
The bank plans to freeze direct debits and standing orders while stopping access to funds. Affected customers then have 30 days before their accounts are closed by the bank.
The intention is to get lazy customers to quickly find a new bank to do business with.
However, Ulster Bank’s approach has been criticized for not giving customers enough time.
Labor TD Ged Nash said on Thursday that the central bank “has an obligation to stop Ulster Bank from forcibly transferring its customers” if it has failed to comply with the Consumer Protection Code.
“The Consumer Protection Code, which sets the threshold that Ulster Bank must meet, is very clear. Ulster Bank must “ensure that all outstanding business is properly completed before … ceasing operations,” he said.
“The central bank needs to explain clearly how it understood that this threshold was reached.”
The central bank has repeatedly warned it would take unspecified action against Ulster and KBC if they fail to meet their commitments.
With the pace of account closures slowing by 14 percent in October, it appears customers are requiring much more time and help than banks initially anticipated, according to the latest figures.
https://www.independent.ie/business/irish/vast-majority-havent-moved-ulster-and-kbc-accounts-to-new-banks-as-deadline-looms-42135624.html The vast majority have not moved Ulster and KBC accounts to new banks as the deadline looms