Yahoo Finance Ethical Banking: Big Increase In Applications
More people are making enquiries about moving their money from high street banks to building societies and ethical banks, according to the Building Societies Association.
It says its members have reported an increase in telephone enquiries from customers concerned about recent banking scandals coupled with a general mistrust of the financial sector.
The Co-operative Bank claims a 25% increase from last week in online applications to switch accounts. Lisa, a 33 year-old filmmaker from East London has just closed her Barclays (LSE: BARC.L - news) account and moved her money to the Co-operative. She (SNP: ^SHEY - news) told Sky News:
“I don’t agree with Barclays’ investments or their interest rates. They penalised me for being in debt and every time a cheque bounced they hit me with more charges.
“They charged me money for things which should be part of their service. They’re not customer focussed and they were always trying to sell me something.
“What’s happened now with Barclays has just confirmed my decision to close my account and it makes me feel more comfortable my money is in a bank that is transparent and ethical about its investments.”
The website www.moveyourmoney.org.uk was set-up three months ago to help customers switch banks. They say that since launching, 10,000 customers have informed them they’ve already switched accounts.
They also claim there has been a fifteen-fold increase in the number of hits their website has received since the launch. Comments posted on the site from members of the public include:
“I think it is increasingly obvious that the only way to make a difference is by direct action! Wish I had looked into it sooner!” – Jill
"After everything that has gone on with the financial crisis with banker’s bonuses, with banking manipulations and unethical investments, I cannot stand the thought that my money is supporting the social and moral disintegration of our society!" – Luke
"This latest scandal has motivated me to do the right thing and move my money somewhere I hope is more ethically run and not so greedy and profiteering" - Dolly
The Ecology Building Society said visits to its website were up 50% on Monday compared to a week ago and visits to the site over the past week were up 266% compared to the same week last year, though this has not yet translated to a surge in enquiries.
Ecology spokesperson Anna Laycock said: "We tend to find the decision-making process isn’t that quick for decisions about savings accounts – but we’ve definitely seen an increase in enquiries via social media. People are taking a more active interest in the operations of their banks and are looking for greater transparency."
Last week, Sir Mervyn King, the Governor of the Bank of England, warned Britain’s high street banks they were guilty of the “shoddy treatment of customers" and "deceitful manipulation".
David Cameron also recently warned HSBC (LSE: HSBA.L - news) , Barclays, Lloyds TSB (LSE: LLOY.L - news) and RBS (LSE: RBS.L - news) to clean up their act after they admitted selling un-suitable financial products to small businesses.
One of these products was a form of interest-rate insurance for companies. Known as SWAPS, the products were designed to protect firms from interest rate rises.
But many small businesses ended-up paying tens of thousands of pounds in penalties and some found it impossible to come out of the deals.
Related stories