Online Challenger Banks

Lord Popat Excerpts

Monday 27th April 2026 Lords Chamber

[Lord Popat (Con)]

My Lords, during my time as a trade envoy to Rwanda and Uganda, I noticed first hand that UK businesses could open a bank account in those countries in less than five minutes, but it will take three months, if they are lucky, to open a bank account here. The Minister mentioned that it is a commercial decision, but is heavily legislated for through the Bribery Act, the money laundering Act and many others. Can the Minister please look into this, particularly for SMEs that are starting new businesses and are having real difficulty opening a bank account?

[Lord Livermore (Lab)]

The noble Lord will know that the money laundering regulations rightly mean that, for new customers opening an account, banks are required to take due diligence measures to verify the customers’ identity, assess the intended purpose of the account and flag any suspicious transactions to law enforcement. The regulations are not prescriptive in setting out specific steps that banks should undertake to satisfy customer due diligence, but instead require them to take a proportionate approach, which I think is what the noble Lord is asking for. Each bank will therefore have its own policies and procedures, and those policies should be informed by each bank’s own assessment of the risk faced by its services and customers, based on sources such as the national risk assessment of money laundering and terrorist financing.