Charities: Banking Services

Baroness Gohir Excerpts

Thursday 23rd July 2026 Lords Chamber

[Lord Lemos (Lab)]

The question of regulation is really important here, so I should set out the position clearly. Charities are protected by the FCA’s consumer duty up to £1 million turnover, and if they want to seek redress from the Financial Ombudsman Service, they can do so if they have turnover of less than £6 million. I would encourage charities, if they are really unhappy with their bank, to use the UK Finance “find a bank” tool—it is not called that, but you know what I mean—and the customer account switching service. The best tonic for poor service is competition.

[Baroness Gohir (CB)]

My Lords, earlier on, the Minister said that the assessment is risk-based, but a report by the Muslim Charities Forum shows that two-thirds of Muslim charities face banking issues. Are the Government suggesting that Muslim charities pose more of a risk, and why is that?

[Lord Lemos (Lab)]

No, I do not think that is what we are suggesting. We are suggesting that the banks must act proportionately and in a risk-based way. I think the noble Baroness knows that there are issues, not just in the Muslim community, of which charities must be vigilant, involving financial crime, money laundering and so on. We would not want to stop banks doing that, but of course we would strongly oppose any idea that that targets any specific community.