Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if her Department will take steps to ensure that banks enable prospective customers to open bank accounts using (a) Digital ID and (b) eVisas.

Ensuring all individuals have access to the appropriate financial services and products they need is a key priority for Government. Financial institutions are required to ask for proof of identity for new customers when they first open an account as laid out in the Money Laundering Regulations 2017 (the Regulations). The Regulations do not stipulate how a firm should verify their customers’ identities. Firms are instead required to apply a risk-based approach to how they comply with the customer due diligence requirements in the Regulations.

The Joint Money Laundering Steering Group (JMLSG) guidance makes it clear that firms can use electronic sources to verify a customer’s identity, provided that they have both (i) verified that the customer (and where appropriate, beneficial owner) exists and (ii) satisfied themselves that the applicant seeking the business relationship is, in fact, that customer (or beneficial owner).

In September, the government set out plans for a new government-backed Digital ID scheme. This Digital ID will make it easier for people across the UK to use vital government services, but will also streamline verification processes across private sectors too, such as when opening a new bank account. The government will be launching a public consultation later this year to engage industry on the proposals.

An eVisa is an online record of a person’s immigration permission in the UK, and any conditions which apply. The Home Office published guidance on the use of eVisas for identity checks, or know your customer (KYC) checks aimed at banks and other financial institutions. Individuals with an eVisa can evidence their identity and immigration status by using the online ‘view and prove your immigration status’ service to provide a time-limited code (‘share code’) to third parties such as landlords, employers and banks.

The Home Office has also implemented a comprehensive engagement strategy to smooth the transition to eVisas and to maximise awareness raising across various sectors. This includes collaboration with key stakeholders including migrant organisations and financial services providers.

Each firm will have their own policies on identification, and on the circumstances in which other checks should be undertaken. Government does not prescribe those detailed policies but expects them to be proportionate and supports firms’ efforts to be flexible and inclusive when considering relevant documentation.