Why the Prime Minister must order a Royal Commission into de-banking and financial exclusion: Greg Wright

That’s why the banks must be carefully monitored to ensure they treat customers fairly. Regular readers of this column will be aware of my long-standing concerns that small businesses with legitimate grievances against the major banks are being denied justice. If you’re business is on its knees due to banking misconduct, it’s very hard to summon the financial and legal muscle to hold the rogue bankers to account.

But a wider probe of banking practices is long overdue. I was alarmed to discover that an organisation representing British Muslims has raised concerns about the “arbitrary closure” of accounts. The Muslim Council of Britain (MCB) has written to the Prime Minister, Chancellor and others calling for the protection of universal banking rights, irrespective of someone’s religious or cultural background or political views.

The group said many law-abiding Muslims and Muslim-led organisation have been gravely impacted by the arbitrary withdrawal of banking services. Banks are facing the prospect of widespread reforms to account closures after the Nigel Farage de-banking row that led to the resignation of NatWest chief executive Dame Alison Rose.

The MCB said British Muslims have been disproportionately affected by bank accounts being closed down for many years. The organisation also sent its letter to leaders of opposition parties as well as the Permanent Secretary to the Treasury. The letter should be studied closely.

It states: “Your decisive intervention calling for change at the NatWest group, following the recent denial of banking services to Nigel Farage, is of note. For British Muslims and Muslim-led organisations however, the arbitrary withdrawal of banking services by different UK banks has become par for the course over the past decade.”

It added that “significant cause for concern” remains “that many British Muslims and Muslim-led organisations have somehow been determined to be a potential risk” despite a lack of “validated evidence of any criminal activity”.

Zara Mohammed, the MCB secretary general, has called for an impartial review that not only addresses the mechanisms behind bank account closures but also examines why British Muslims are being disproportionately affected by this issue. A spokesman for UK Finance, the financial services trade body, stressed that customers should not have an account closed inappropriately or unfairly.

The spokesman added: “In all cases customers must be treated fairly and the decision to close an account is only taken after extensive review. The Government has recently announced there will be an increased notice period and more information provided around account closures. These are important changes and we will be working with the Government and other regulatory bodies to implement them.”

The Prime Minister can show he’s on the side of consumers by ordering a Royal Commission into financial exclusion and de-banking. If the banks have behaved impeccably, they will have nothing to fear from scrutiny.

Greg Wright is the deputy business editor of The Yorkshire Post