EP wants access to basic banking services for all
"In Ireland, it is estimated that approximately 100,000 adults do not have bank accounts, many because they are excluded. In fact, levels of financial exclusion are higher in Ireland than in most EU15 countries, mainly due to the fact that we do not have a long history of banks catering for low income consumers." Gay Mitchell MEP
Basic banking services should be a legal right for the 10% of EU citizens who currently do not have any, including homeless people, those on very low incomes, students, people with no credit record and expatriate workers, Parliament said on Wednesday. MEPs called on the Commission to table legislation by January 2013 to tackle this financial exclusion.
Gay Mitchell MEP (Fine Gael Dublin), Irish member of the Economic and Monetary Affairs Committee and co-author of the report on Access to Basic Banking Services said
"In Ireland, it is estimated that approximately 100,000 adults do not have bank accounts, many because they are excluded. In fact, levels of financial exclusion are higher in Ireland than in most EU15 countries, mainly due to the fact that we do not have a long history of banks catering for low income consumers. Credit unions have traditionally played an important role in providing saving and credit services to low income earners- however this does not include electronic banking services. Ireland also ranks poorly because there is no requirement or ability for recipients of social welfare payments to have a bank account as payments can be made in cash via Post Offices.
"However, in this day and age, where a bank account is convenient, some might say necessary, for leading a normal life, where it is needed for the most basic things such as renting accommodation, using internet services, or booking tickets, it is not acceptable that so many people still cannot access basic payment accounts"
Ongoing banking reforms should also serve the needs of the vulnerable, those who are financially and socially excluded"
Soft approach not working
Legislation is needed at EU level because simple Commission recommendations have yielded the desired results in only a few countries and banks have a natural tendency to target only commercially attractive clients.
The cheapest option with no strings attached...
The basic payment account must always be cheaper than any alternative offered by a given institution, the resolution says.
Banks and other institutions offering payment accounts must not be able to refuse to grant such an account on grounds such as low income, type of employment, credit history, or level of indebtedness. Most importantly, they must not be allowed to make the basic account conditional on the purchase of other products or services, adds the text.
... which allows all basic transactions
The basic account would allow a person to carry out any essential payment transaction such as receiving income or benefits, paying bills or taxes, buying goods and services, making cash withdrawals, and printing account statements.
The resolution was adopted by 585 votes to 68, with 5 abstentions.