EU seeks to ease access to bank accounts

July 18, 2011 7:17 AM ET                                                            Associated Press

By GABRIELE STEINHAUSER

BRUSSELS (AP) – The European Union on Monday asked member states to make it easier for EU citizens to open a basic bank account, regardless of where they live, their income or credit history.

Around 30 million people — or 7 percent of adults — in the 27-country bloc don't have a bank account, often preventing them from receiving benefits or paying bills, the European Commission, the EU's executive, said.

The number of adults without bank accounts is particularly high in new EU states like Bulgaria and Romania, where only about half of citizens have an account, according to the Commission.

Access to basic banking services, like withdrawing and transferring money, is "an absolutely essential tool for daily life," the EU's Internal Market Commissioner Michel Barnier said in a news conference. "It really is part of our social inclusion."

One of the main obstacles to opening a bank account is not having a proof of address, affecting not only the homeless but also trainees or migrant workers who move to a different state for a short time.

EU states should now enter talks with their banks to ensure that all citizens can open a basic account, without overdrafts and at affordable fees, the Commission said. At the moment, too many people are being denied access to banking services because they cannot fulfill requirements linked to identity checks, residency, proof of income or credit history, it said, adding that normal safeguards against money laundering and other types of fraud would still apply.

If individual governments don't make enough progress within a year, the Commission may set binding rules on basic bank accounts, Barnier warned.

Read the complete AP story here.

 

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