Are you suffering to keep your UK account as an expat?
Many will have already have been impacted by UK banks closing accounts if you are resident overseas. The most prominent in recent times is Barclays.
If you spend more than 180 days outside of the UK (as a rule of thumb) you will be deemed as resident in that foreign country. So moving abroad for work or retirement will dictate how you manage your money overseas.
Many banks have decided not to allow expats to continue using their UK savings or current accounts while resident abroad.
As a result, you may have already been contacted by Barclays with a 6 month warning that as the account holder, you will have this time to find new services elsewhere. This stems from a policy change that occurred in 2021.
It is therefore important to consider your options and we will explain what to do if you are a Barclays account holder. We will also delve into other alternative banking options for expats.
There are multiple reasons why a UK national may wish to keep banking facilities in the UK
Many choose to retire or work abroad but still have financial links to the UK that need to be serviced. It may be that they have a state pension that needs to be paid into a UK bank account or they may have property that is rented out in the UK. It is therefore commonly easier to have those rental payments paid into a UK bank account or be able to pay such liabilities as landlord’s insurance from that said account.
This may start to ring true for many reading this article. It is also well known that in many cases, you may suffer high fees or be offered poor exchange rates when converting GBP into local currencies within non-UK accounts.
So where does this leave you if you are a Barclays account holder?
Unfortunately, if you have an address registered outside of the UK, Barclays will no longer offer services for savings account or current accounts. You must be a resident in the UK with an UK address to continue services. There are a few circumstances under which this may still be allowable. Such as:
- If you are residing less than 6 months overseas, then you simply need to let Barclays know and update your address details on your return
- Someone else is managing the account on your behalf in the UK
- If you are a crown employee abroad
If you are using Barclays International Banking then the changes will not apply to you. And Barclays have also announced that they will make no changes to existing arrangements such as mortgages or loans.
What steps do you need to take?
If you have been contacted by Barclays with the 6-month warning, you should follow the steps they have outlined in their letter. This is important so you do not get locked out of your finances.
What are the alternative solutions and other banking facilities?
Let’s take a look at other banks policies.
Standard Bank – Offshore, Isle of Man
Anyone can hold an offshore bank with Standard Bank with a minimum of 7,000 GBP held on any currency account. It offers credit cards, online banking, broker services and normal banking facilities for savings and current accounts.
They accept residents from all countries that are not on a current sanctions list. A clear winner in our opinion.
HSBC
HSBC also seem to be closing many accounts from residents overseas with little notice outside of the EU. They do offer to UK nationals living within the EU, normal current accounts. This will heavily depend on local country regulations.
First Direct
Any existing relationship that includes current accounts and savings accounts will continue. But unless a UK address can be supplied, you will be blocked from any future new products.
Lloyds Group (including Lloyds Bank, Bank of Scotland and Halifax)
Slightly better. Most existing account holders can conduct their business through telephone banking or by using their online banking facilities. It may be worth considering switching to Lloyds Bank International if you haven’t already done so.
Nationwide
UK nationals living overseas will not be able to open new accounts. But the Building Society will allow existing customers to continue using their current accounts and savings accounts. There are exceptions for those residing in Holland and Italy. If you happened to be resident in either of those countries, then you may have to close your accounts in-line with local regulatory obligations.
Santander
You can continue to use your Santander account but services will be dramatically reduced. You may wish to consider switching to Santander International.
What are your options for banking overseas?
For us, Standard Bank is the best solution as it still falls under the remit of the UK and removes many issues. You will be able to use their current banking facilities.
Naturally, you may wish to open a local bank account depending on the type of visa you have. For many who are travelling continually on visitor’s visa’s, this will create a new set of problems.
For those on retirement visas or work visas, the process is a lot smoother in most cases. It would be worth making sure in advance that you can receive payments that you would normally receive into your UK bank account.
This would become obvious for those looking to receive their state pension and will change from country to country that you are residing in. It is also worth noting how the exchange rate would impact you.
Expat international accounts
Having compared the options available to expats, it may become obvious why we suggested Standard Bank as a first choice. It is more than possible to hold accounts with other service providers but let’s take a look at some of the conditions required by other banks.
For example, you will need a minimum of £100,000 deposited on a Barclays overseas account.
With a Lloyds International Current Account, you need to have a gross income of £75,000 and there are fixed charges of £7.50 a month.
Requiring very large gross incomes or extremely high deposits will make quite a few options unfavorable. Standard Bank has a low fixed deposit rate that needs to be held and offers multiple currency accounts with all the usual bells and whistles you would expect from your banking provider.
How about money transfer companies?
There are pros and cons to money transfer companies. You can hold multiple currencies and easily send money between countries. The downside that is these companies do not hold banking licences and do not offer other banking facilities such as mortgages or overdrafts. As they are not licenced, they are also not covered by Financial Services Compensation Scheme (FSCS) so offer no protection. This needs to be considered when choosing what you want from your banking provider.
Get in touch for information on how to open an offshore bank account as an expat. Lawrence.young@holbornassets.com