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Email: ibexdirect@ibexinsure.com

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British living in Portugal may lose UK bank accounts

23-Sep-2020


Thousands of British citizens whose registered address is in Portugal and who do not have a second home in the United Kingdom risk losing their bank accounts by the end of the year.

Lloyds, Barclays and Coutts say that the administrative cost and international processing fees will simply make running accounts for Britons who spend more than 180 days in EU countries like Portugal, simply financially unviable.

The move will come by the end of the year if a trade deal cannot be brokered between London and Brussels by December 31.

Lloyds Banking Group, which includes Halifax and the Bank of Scotland, Barclays and Coutts are contacting thousands of customers by letter telling them that they have to make alternative arrangements as the banks will no longer be able to offer them services.

According to the Guardian, a spokesperson for Lloyds said: “We have written to a small number of customers living in affected EU countries to let them know that due to the UK’s exit from the EU, regrettably we will no longer be able to provide them with some UK-based banking services. We want to keep customers informed and offer advice on next steps.”

The problem is that although the UK has passed legislation which will allow banks to continue to serve UK citizens living within the EU in an arrangement known as ‘passporting’, the EU has not. Unless a trade deal is agreed with the EU, UK financial institutions will have to follow rules which vary from county to country and depend on what services are being offered by what kind of bank.

It is not clear yet if UK citizens spending more than 180 days in an EU country with their registered home there will be able to hold a bank account in England, Scotland and Northern Ireland for use when they return, or they simply will not be able to conduct certain banking operations such as IBAN transfers and other financial services involving, for example, pensions.

Last year Barclaycard holders in Portugal were singled out by the credit card company which falls under the Barclays group and their credit cards were withdrawn. The company said that Portugal was not a strategic market for Barclaycard and not financially viable. UK Barclaycard holders in Spain, however, were not affected.

A Barclays spokesperson said, “In the light of the UK leaving the EU at the end of 2020 we continue to review the services we offer to customers within the EEA and any impacted customers will be contacted directly.” But some customers in France have already been sent letters.

Santander, NatWest and HSBC are monitoring and reviewing the situation and currently have no plans to withdraw retail or corporate accounts, but would keep customers informed of ay changes that might affect services.

The UK trade body UK Finance have stated that banks will have to study the legislation of 30 different countries to see if they can continue serving customers.

Source:- Essential Business