Article by Tom Line - 3rd February 2014

HSBC Limits Cash Withdrawals

Posted by Tom Line in Banking on 3 February 2014 - Tom worked as a Credit Analyst at checkmyfile until 2015

HSBC customers have vented their frustration on various online forums as well as on BBC Radio 4's Moneybox programme following restrictions on how much of their own money they can withdraw over the counter.

The banking giant has imposed a policy which resulted in some of its customers not being allowed to withdraw cash because they cannot provide adequate evidence proving what the money is for. The bank has admitted that it did not inform customers of the change in policy, introduced in November, but defended the decision as 'responsible' stating that it helps the firm to tackle financial crime.

In a statement the bank says, “As a responsible bank we must track all financial transactions. Cash presents more risk, and in particular financial crime risk, than other payment methods”.

Customers say they were shocked when they were obstructed from withdrawing large amounts of cash ranging from £5,000 to £10,000, and some were forced to barter over how much they could withdraw.

One customer expressed his irritation at the policy to BBC Radio 4's Moneybox programme, arguing that he had withdrawn large amounts of money in the past with no problem however, when he attempted to withdraw £7,000 from his instant access savings account, he was refused because he could not provide the bank with a satisfactory explanation as to why he wanted the money.

Other mainstream banks were asked by Moneybox what their policy is regarding the withdrawal of large amounts of cash over the counter. All said that they reserve the right to ask questions about large cash withdrawals, but none would go as far as to request evidence of what the money was being withdrawn for.

Eric Leenders of the British Bankers Association says, “There is a clear tension between on the one hand, providing customers easy access to their money and, on the other hand, protecting customers from the threat of a fraud..”.

Customers will interpret the policy differently; some will see it as a sensible and responsible measure which forms part of the bank’s corporate responsibility policy within the wider community. Others will view the policy as an autocratic inconvenience, causing customers to reconsider their relationship with the bank.

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