The Civil Society Group has launched a joint report on the challenges and barriers charities face with banking.
The report – Charity Banking Challenges 2024 – reveals that nearly all respondents (92%) have experienced at least one difficulty related to banking in the past two years.
The report points to a variety of problems that charitable organisations face, despite ongoing efforts by the banking and charity sectors to improve banking services. The results indicate a systemic issue that requires urgent attention.
1,899 representatives – mainly trustees and volunteers from small to medium-sized charities – took part in a survey launched by the Civil Society Group in March 2024.
The main findings are:
- Nine in ten (92%) of respondents experienced one or more issues related to banking.
- Over three quarters (77%) found changing signatories on bank account mandates difficult.
- Four in ten (40%) had been asked to complete checks that were not designed for charities or voluntary organisations.
- Nearly a third (32%) had found it difficult to open accounts with a new bank.
- Over a quarter (29%) stated that a requirement to provide personal information for all trustees, not just signatories, was problematic.
Alongside the difficulty of administration, respondents said that communicating with their bank was a challenge and, at times, had been a source of stress. This was exacerbated by a lack of access to bank branches.
- Over a quarter (27%) couldn’t get clear explanations from their banks.
- Two in ten (21%) reported that communications sent by their bank had left them worried or feeling threatened.
- Over a third (37%) reported their nearest bank branch is between three and ten miles away, with most respondents indicating that it takes them 10 to 30 minutes to reach
- Nearly one-third (29%) said it took between 30 minutes and one hour to travel to the nearest branch.
Clare Mills, Deputy CEO of Charity Finance Group (CFG) and the report’s co-author, comments:
“This latest report on charity banking challenges backs up the findings of the research we conducted in 2022 which kick-started our work with the banking sector. Both reports show widespread frustration with retail banking services across the UK charity sector.
“All too often, banks do not understand the governance structure of charities and therefore don’t ask the right questions. At times, they do not explain clearly enough what is required and why. There is a clear disconnect between the service that retail banks think they provide to their charity account holders, and the level of service they receive.
“The majority of those managing banking for charitable organisations are giving their time, skills and energy for free. Unfortunately, too many are wasting time and resources trying to resolve common banking issues. This means that the charity’s beneficiaries – the people and communities they serve – miss out.
“Banking challenges not only drain precious resources from charities, but can expose them to risks, such as fraud or having their account closed without warning or explanation.
“There’s an urgent need for the Civil Society Group, UK Finance, the FCA and banking representatives to continue to work together to find real solutions to these very common but frustrating challenges.”
Saskia Konynenburg, Executive Director at NCVO, said:
“Today’s findings clearly demonstrate that the banking sector still isn’t meeting the essential needs of charities and voluntary organisations. The sheer level of charity staff and volunteers experiencing significant banking challenges, shows these issues are systemic and require immediate action.
"Banking is a key need for charities, but retail banking services are not set up with charities in mind. Therefore, things that should be simple like changing a signatory become onerous tasks, draining time and finite resources at best, and at worst leaving them with closed accounts and no access to funds.
"We urge banks to expedite this work to implement meaningful changes that will ensure charities can manage their finances effectively and focus on supporting the communities they’re set up to help.”
Download Charity Banking Challenges 2024.
Editor’s notes
About the Civil Society Group
The Civil Society Group is made up of almost 90 organisations that support the UK charity and voluntary sector. The tens of thousands of charities and community groups that we work with range from micro volunteer-led groups to national ‘household name’ charities, supporting millions of people every year, with everything from mental and physical health, to advice, to crisis support, and more.
About CFG
CFG is the charity and membership organisation that supports other charitable organisations to make the biggest difference possible. We do this by helping them to make their money and resources go further. CFG’s vibrant community manages around one third of the UK’s entire charity sector income. We are a diverse and inclusive community of finance professionals and charity leaders who are passionate about delivering impact through financial leadership. Together, we lead the way for charity finance. More about CFG.
About NCVO
The National Council for Voluntary Organisations (NCVO) is the largest membership organisation for the voluntary sector in England. With over 17,000 members, NCVO represents all types of organisations, from large ‘household name’ charities to small voluntary and community groups involved at the local level. NCVO is also the lead body for volunteering in England. More about NCVO.
Contacts
Emma Abbott, Communications Manager, CFG: emma.abbott@cfg.org.uk
Glyn Sheldon, Communications Officer, CFG: glyn.sheldon@cfg.org.uk
Holly Townsend, Communications Manager NCVO: 07852 721478 press@ncvo.org.uk
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