Charity Banking

The UK Finance trade association for the UK banking and financial services sector recently launched a Voluntary Organisation Banking Guide to help charities and other voluntary groups with opening and managing bank accounts. Here, we tell you what you can expect from this new guide and explore whether it is likely to transform your banking experience. 

• Choosing the right legal structure for the organisation
• Identifying banking requirements and comparing offerings from 13 different banking providers, including high street banks and brands specialising in the not-for-profit sector.
• Preparing the necessary information to open a bank account, including verifying identities and governing documents
• Maintaining the account over time, such as updating contact details and account usage

While the guide is a useful resource to help voluntary organisations navigate the banking process, it places the onus on the organisations themselves to improve their banking experiences. The guide does not directly address many of the root issues reported by charities, such as: 

• Banks' reluctance to provide bank accounts to charities, especially to smaller or unincorporated organisations
• Banks closing charity accounts due to compliance concerns
• Poor customer service and lack of understanding about charity structures and governance
• Onerous information requirements that don't fit the charity model

Experts note that the guide will not solve these deeper problems, which require banks themselves to improve their services and understanding of the charity sector. Overall, the guide is a step forward, but more changes are needed from banking providers to truly transform the banking experience for voluntary organisations.