MPs have urged the government to “work urgently” with the Financial Conduct Authority and UK banks to improve services for charities, with the sector facing “widespread” difficulties.
Last week, Shockat Adam, independent MP for Leicester South, tabled an early day motion – since welcomed by the Charity Finance Group (CFG) – calling for action in the wake of “account freezes, lost records, and barriers to opening new accounts”.
The motion has so far been backed by George Adam, Lib Dem MP for St Ives, the SNP’s Graham Leadbitter, MP for Moray West, Narin and Strathspey, and Jim Shannon, DUP MP for Strangford.
It notes: “Poor banking provision is placing charitable services at risk, forcing some volunteer trustees to use personal bank accounts to meet financial obligations, and in some cases driving experienced trustees to resign.”
Charities’ ‘significant issues’ with banking
In November 2024, research by the Civil Society Group found that more than nine out of 10 (92%) charities had experienced at least one banking difficulty in the past two years.
Three-quarters of respondents cited changing signatories on bank account mandates as their top challenge, followed by completing checks “not designed for charities” (40%).
Starting in June 2025, updates to CAF Bank’s systems caused chaos for some of its 14,000 charity customers, with some locked out of services while trying to pay staff. CAF Bank later paid a local infrastructure organisation £750 in compensation after it complained about online service disruption to an ombudsman.
In July 2025, a Charity Commission survey found most (58%) charities banking with Barclays – the main single provider to large charities with annual incomes over £20m – had experienced issues. Access to banking services was “still a significant issue for many” in the sector despite some signs of improvement, Holly Riley, head of strategic policy at the commission, said at the time.
Meanwhile, faith charities in particular have reported experiences of being debanked, with one survey finding that two in five Islamic charities had experienced a full withdrawal of banking services.
Adam’s motion called for measures to “ensure bank staff are properly trained to understand how charities operate and [to] introduce stronger protections to prevent charities from having their accounts frozen or closed without adequate notice or justification”.
‘A source of stress for trustees, staff and volunteers’
The CFG issued a statement welcoming the motion, with Clare Mills, the organisation’s co-CEO, noting that after working with banks “there has been some improvement, [but] the impact of the challenges many charities are experiencing can be significant”.
She added that initial findings from the CFG’s 2026 Banking Survey suggest that “banking services continue to be a source of stress” for trustees, staff and volunteers.
“We’ve written to MPs across the political spectrum urging them to support this motion, and we’ll also be following this up with ministers at HM Treasury and colleagues at the FCA and individual banks,” Mills said.
“Access to efficient and suitable banking services is essential to charities of every shape and size across the UK, so they can focus on their mission and their beneficiaries.”
