Banks Challenged To Disclose Lending Patterns

Debt on our Doorstep today challenged the U.K's leading banks to disclose information on their lending to disadvantaged communities, and to release information on their individual performance in providing banking facilities to people on low incomes.

The move came as the Chief Executives of the big five were providing evidence to the Treasury Select Committee's Inquiry into Financial Inclusion.

Damon Gibbons, Chair of Debt on our Doorstep, commented "Back in 2000, the Government was recommended to introduce rules to ensure that banks disclosed information on lending to disadvantaged groups and communities. No action has been taken, and we still have huge disparities in terms of access to financial services in the UK. The big banks are getting away without having to provide detailed information on the extent of this problem. It's time for the Government to act."

Debt on our Doorstep will today send a letter to the Chair of the Treasury Select Committee, John McFall M.P, calling for him to make recommendations to Government to ensure:

That Banks disclose details of their banking and lending activities on a geographical basis to allow a map of financial exclusion to be developed for the U.K;

That the Treasury introduce a compulsory rating system for banks that reflects the extent to which they are making facilities available to low income groups;

That sanctions be considered for banks that fail to provide services to disadvantaged communities in the event that voluntary disclosure and rating proved ineffective to improve bank performance.

Notes to Editors

1. Around 11 per cent of adults in the UK still don't have access to bank accounts compared with around 1-4 per cent for most European countries. And, when reviewed against deprivation indices the figures for the UK are starker still - 35 per cent of people in deprived areas don't have bank accounts.

2. The UK banking sector is dominated by five large banks, which together control 84 per cent of current account provision. In 2004, the four largest banks together earned profits in excess of £23 billion - earning in the region of £126 profit per customer in the UK compared with £70 per customer in 2003.

3. Debt on our Doorstep Proposals for a UK ratings system were supported by the Social Investment Task Force in 2000, and last year's review of progress towards the aims of the Task Force highlighted the need for the Government to act.See the report here