Asked by: Stephen Timms (Labour - East Ham)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what preparations he has made to legislate for the long-term regulatory framework for Open Banking once the Joint Regulatory Oversight Committee reports in 2023.
Answered by Andrew Griffith - Minister of State (Department for Science, Innovation and Technology)
UK Open Banking has been a great success story with over 7 million people in the UK now regularly using this technology to manage their money and to make payments.
The Government is committed to maintaining the UK’s leadership in this field and sustaining momentum. We wish to build on the initial success of UK Open Banking to help unlock and realise further benefits for consumers, businesses, and the wider economy.
HM Treasury is working closely with the relevant regulators through the Joint Regulatory Oversight Committee to develop recommendations on the design of the future Open Banking entity. HM Treasury is also leading work to develop a long-term regulatory framework for this technology, underpinned by any necessary legislation.
The Committee will release its recommendations in the coming weeks following joint statements in March and December 2022 which can be found at: https://www.gov.uk/government/publications/joint-statement-by-hm-treasury-the-cma-the-fca-and-the-psr-on-the-future-of-open-banking/joint-statement-by-hm-treasury-the-cma-the-fca-and-the-psr-on-the-future-of-open-banking and https://www.gov.uk/government/publications/joint-statement-by-hm-treasury-the-cma-the-fca-and-the-psr-to-update-on-the-future-of-open-banking/joint-statement-by-hm-treasury-the-cma-the-fca-and-the-psr-to-update-on-the-future-of-open-banking.
Asked by: Jessica Morden (Labour - Newport East)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, for what reason the maximum payment amount that can be collected in a single transaction using the Payment Exception Service at a Post Office or pay point outlet is set at £100 requiring some claimants to make multiple transactions to access the full amount of their benefits or pension.
Answered by Victoria Prentis - Attorney General
The most secure way to receive payment is through a bank account. For those customers who are unable to open or manage a bank, building society or credit union account, the DWP’s new Payment Exception Service has been designed as a simple service to ensure customers have access to cash. Vouchers are uploaded to a card or sent electronically via SMS text or email. A customer can print their emailed vouchers and present them to the retailer. The maximum amount of a voucher is £100 so a customer may receive more than one voucher on their payment due date. Customers must cash the full amount of the voucher but do not have to cash all of their vouchers at the same time. This is a similar process to when customers used to be issued with Order Books and Girocheques.
Payment Exception Service vouchers can be encashed at over 26,000 PayPoint outlets nationally as well as Post Offices nationwide. The service provided by this contract meets DWP’s statutory requirement to ensure all customers can access payments, including where standard banking is not available to them.
The £100 voucher amount represents a value that protects vulnerable customers from being required to withdraw and carry large sums and is one that the PayPoint Retailer network can support.
Asked by: Gareth Thomas (Labour (Co-op) - Harrow West)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, whether her Department is taking steps to prevent benefit payments made to a UK bank account from transfer into a Russian bank account.
Answered by Guy Opperman - Parliamentary Under-Secretary (Department for Transport)
The government have imposed sanctions on Russian banks. This means the Department has suspended the payment of the State Pension – the only benefit affected by this action - due to those claimants where payment was going directly to any Russian bank which has been sanctioned under The Russia (Sanctions) (EU Exit) Regulations 2019. For claimants who are not sanctioned as individuals under the above Regulations, if they open an alternative account with a non-sanctioned bank then payment will resume.
The transfer of payments from a UK account to any other account is by agreement between the claimant and the receiving bank. The department would not be aware and in terms of the individual’s entitlement to the benefit being received, does not need to be aware of any such agreement. If there was an agreement to transfer money to a Russian account, then the banking protocols arising from the above legislation would have applied to regulate the transfer.
Asked by: Gareth Thomas (Labour (Co-op) - Harrow West)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, whether any benefit payments made by her Department into a UK bank account have been transferred into a Russian bank account in the last six months.
Answered by Guy Opperman - Parliamentary Under-Secretary (Department for Transport)
The government have imposed sanctions on Russian banks. This means the Department has suspended the payment of the State Pension – the only benefit affected by this action - due to those claimants where payment was going directly to any Russian bank which has been sanctioned under The Russia (Sanctions) (EU Exit) Regulations 2019. For claimants who are not sanctioned as individuals under the above Regulations, if they open an alternative account with a non-sanctioned bank then payment will resume.
The transfer of payments from a UK account to any other account is by agreement between the claimant and the receiving bank. The department would not be aware and in terms of the individual’s entitlement to the benefit being received, does not need to be aware of any such agreement. If there was an agreement to transfer money to a Russian account, then the banking protocols arising from the above legislation would have applied to regulate the transfer.
Asked by: Alexander Stafford (Conservative - Rother Valley)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has had discussions with representatives from the UK banking sector on ensuring that reputable and regulated digital asset companies can secure business bank accounts in the UK.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The government set out at Fintech Week our firm ambition to make Britain a global hub for cryptoasset technology and investment. The government wants to ensure firms can invest, innovate and scale up in this country. And the government have announced a number of reforms which will see the regulation and aspects of tax treatment of cryptoassets evolve – our clear message to cryptoasset firms is that the UK is open for business.
These include committing to consult on a future regulatory regime later this year; legislating to bring stablecoins into payments regulation; setting up a ministerial-chaired Cryptoasset Engagement Group, bringing together key figures in industry; working with the Royal Mint to create a Non-Fungible Token; and exploring ways of enhancing the competitiveness of the UK tax system to encourage further development of the cryptoasset market in the UK.
HM Treasury holds regular discussions with the Financial Conduct Authority (FCA) on a range of issues regarding the regulation of financial markets, including cryptoassets.
The government established a Cryptoassets Taskforce in 2018, consisting of HM Treasury, the Bank of England, the Payment Systems Regulator (PSR) and the FCA. The Taskforce’s objectives include exploring the impact of cryptoassets, the potential benefits and challenges of Distributed Ledger Technology (DLT) in financial services; as well as assessing what, if any, regulation is required in response.
The decisions about what products are offered, including commercial accounts, and to whom remain commercial decisions for banks and building societies.
Asked by: Dan Jarvis (Labour - Barnsley Central)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, what assessment her Department has made of the potential effect on claimants of no longer being able to receive benefits through their Post Office card accounts.
Answered by Guy Opperman - Parliamentary Under-Secretary (Department for Transport)
The Department has been encouraging Post Office card account customers to transfer to a standard account since 2016. Paying claimants into a standard account is the most efficient and safest payment method for the customer, and the Department.
Standard accounts have many advantages for the individual, for example, the ability to use direct debits and to pay for goods and services using a debit card. A standard account allows customers to access cash payments via a wide range of outlets and settings. The Post Office delivers personal banking services for a wide range of banks, building societies and other financial institutions, including cash withdrawal with a debit card.
The Department has continuously gathered insight from customers who contact us to discuss the closure of their Post Office card account to better understand their needs. This insight identified that some customers are unable to open or use an alternative account and for these customers we will pay through an alternative payment exception service to ensure that nobody will be left without access to their benefits or pension.
Asked by: Rachael Maskell (Labour (Co-op) - York Central)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he is taking to ensure that investors with National Savings and Investments receive their income bonds as speedily as possible when requested.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
For NS&I Income Bonds customers, funds accrue interest from the date the customer has originally made their deposit, though the transaction may not necessarily appear in a customer’s accounts until a later date
For an electronic transfer deposit received by 18:30 on a banking day will normally clear on the next banking day. Debit card and cheque deposits will clear no later than the seventh banking day after being received. However, if a customer applies to open a new Income Bonds account, or makes a subsequent deposit, by debit card between 8pm on the 20th of a month and the 5th of the following month, their updated balance will not display online until the 6th of the month. Instead, the transaction will show in ‘Pending transactions’. This is because of a period where NS&I calculate the monthly interest payments. Customers will still accrue interest from the date they originally made their deposit and NS&I will pay that accrued interest on the next available interest payment.
Asked by: Mark Tami (Labour - Alyn and Deeside)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what support he has put in place for small businesses to access bounce back loans where their banking arrangements are solely with financial institutions that do not offer those loans.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Bounce Back Loan Scheme (BBLS) was designed to ensure that the smallest businesses can access loans of up to £50,000, capped at 25% of firms’ turnover in a matter of just days. The Government is providing lenders with a 100% guarantee on each loan to give them the confidence they need to support the smallest businesses in the country, and no interest payments are due for the first 12 months. As of 20th September, over 1.2 million facilities have been approved through BBLS representing a value of more than £38bn.
The Bounce Back Loan scheme rules do not mandate that the applicant must have a business relationship with the lender in order to receive a BBLS loan. The British Business Bank has so far accredited 28 BBLS lenders, including several non-banks and alternative lenders.
The Government does not intervene in their lending decisions.
Some banks have made good on their intention to invite applications from new customers, and many of those that are still only open to existing customers are regularly reviewing that position. The Government have always made clear to lenders that they should open to new customers as soon as it is operationally possible for them to do so.
Asked by: Julian Sturdy (Conservative - York Outer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps his Department is taking to encourage the provision of mobile bank branches.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The branch strategy of individual firms may be driven by a variety of factors, including customer interests, market competition and other commercial considerations. These are commercial decisions for firms and the Government does not intervene in this decision-making.
Throughout the Covid-19 pandemic, the Government has been working closely with the financial regulators, banks, building societies and credit unions to ensure they continue to maintain branch access for essential services while balancing the needs of their customers with the safety and welfare of staff. Though many firms have reduced their opening hours the vast majority of branches have remained open for customers. Furthermore, several retail banks have put in place solutions for vulnerable customers, including enabling them to make payments through a trusted person or have their cash securely delivered to them at home. Many firms have also set up dedicated phone lines so these customers can speak to their provider as quickly as possible.
The way consumers interact with their banking is changing. In recent years, over two-thirds of UK adults have used contactless payments and online banking and nearly half have used mobile banking, according to UK Finance. As a result of the pandemic, many customers may have used these channels for the first time. However, the Government still firmly believes that the impact of branch closures should be understood, considered, and mitigated where possible so that all customers, wherever they live, continue to have access to over-the-counter banking services if they wish to use them. That’s why the Government supports the industry’s Access to Banking Standard which informs customers of the bank’s reason for closure and helps customers to understand the options they have locally to continue to access banking services.
The Post Office also allows 95% of business and 99% of personal banking customers to carry out their everyday banking at 11,500 Post Office branches across the UK. Customers have been able to use the Post Office for essential banking services as an alternative to their branch throughout the pandemic. Customers can also use ATMs or cash machines as normal for cash withdrawals and balance enquiries.
In July 2020, the regulator the Financial Conduct Authority published draft guidance setting out their expectation of firms when they are deciding whether and how to reduce their physical branches or the number of free to use ATMs. Firms are expected to carefully consider the impact of a planned closure on their customers’ everyday banking and cash access needs, and other relevant branch services and consider possible alternative access arrangements, which may include mobile branches. This will ensure the implementation of closure decisions is done in a way that treats customers fairly.
Asked by: Julian Sturdy (Conservative - York Outer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent assessment his Department has made of the accessibility of in-branch banking services for people living in a rural setting.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The branch strategy of individual firms may be driven by a variety of factors, including customer interests, market competition and other commercial considerations. These are commercial decisions for firms and the Government does not intervene in this decision-making.
Throughout the Covid-19 pandemic, the Government has been working closely with the financial regulators, banks, building societies and credit unions to ensure they continue to maintain branch access for essential services while balancing the needs of their customers with the safety and welfare of staff. Though many firms have reduced their opening hours the vast majority of branches have remained open for customers. Furthermore, several retail banks have put in place solutions for vulnerable customers, including enabling them to make payments through a trusted person or have their cash securely delivered to them at home. Many firms have also set up dedicated phone lines so these customers can speak to their provider as quickly as possible.
The way consumers interact with their banking is changing. In recent years, over two-thirds of UK adults have used contactless payments and online banking and nearly half have used mobile banking, according to UK Finance. As a result of the pandemic, many customers may have used these channels for the first time. However, the Government still firmly believes that the impact of branch closures should be understood, considered, and mitigated where possible so that all customers, wherever they live, continue to have access to over-the-counter banking services if they wish to use them. That’s why the Government supports the industry’s Access to Banking Standard which informs customers of the bank’s reason for closure and helps customers to understand the options they have locally to continue to access banking services.
The Post Office also allows 95% of business and 99% of personal banking customers to carry out their everyday banking at 11,500 Post Office branches across the UK. Customers have been able to use the Post Office for essential banking services as an alternative to their branch throughout the pandemic. Customers can also use ATMs or cash machines as normal for cash withdrawals and balance enquiries.
In July 2020, the regulator the Financial Conduct Authority published draft guidance setting out their expectation of firms when they are deciding whether and how to reduce their physical branches or the number of free to use ATMs. Firms are expected to carefully consider the impact of a planned closure on their customers’ everyday banking and cash access needs, and other relevant branch services and consider possible alternative access arrangements, which may include mobile branches. This will ensure the implementation of closure decisions is done in a way that treats customers fairly.