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Banks transfer balances by cheque … to banks that don't accept them

Anna Tims
·2 min read
<span>Photograph: Rachel Husband/Alamy</span>
Photograph: Rachel Husband/Alamy

Thank you for your article about UK residents in the EU facing the closure of their UK bank accounts because of Brexit. I’m one of those affected. What I think is a farce is that Lloyds is telling customers that it will send their balance by cheque. It is obviously unaware of the fact that banks in the Netherlands stopped accepting cheques in January. I believe Germany no longer accepts them, either.

I phoned the Halifax where I hold an account. The call centre operative was shocked to hear I couldn’t deposit a cheque here and asked me to inform their head office in Leeds. He works for them.
CMH, the Netherlands

It’s extraordinary how, long after most customers have discarded chequebooks, financial institutions seem wedded to them. Last month I reported how Nationwide and NS&I both blamed each other’s inadequate technology for the fact that accounts are transferred by cheque.

The European Union website warns that “many” EU countries no longer accept cheques as a valid form of payment and those that do often charge “very high” transaction fees. Nonetheless, Lloyds Banking Group, which is withdrawing consumer services from the Netherlands and Slovakia and some business accounts in the Netherlands, Germany, Ireland, Italy and Portugal, confirmed that cheques are its default method of returning funds to customers. It told the Observer it would use a money transfer service on request.

It’s likely that a significant number of customers of Lloyds, Bank of Scotland and Halifax will be unaware that their cheques can’t be cashed until they present them to an EU bank. By then, if their account has been closed, it could be a convoluted business retrieving the funds electronically. The regulator, the Financial Conduct Authority, says it expects banks to work closely with local regulators to determine the best way forward and to give customers plenty of notice about planned changes.

If you need help email Anna Tims at your.problems@observer.co.uk. Include an address and phone number. Submission and publication are subject to our terms and conditions