BCOBS 8.1 General and application
Special terms used in this chapter
- (1)
12A “personal current account” means an account, other than a current account mortgage, which is a payment account within the meaning of the Payment Accounts Regulations (see BCOBS 8.1.2G(1));
- (2)
A “private bank” is a bank or building society or an operationally distinct brand of such a firm over half of whose personal current account customers each had throughout the previous financial year net assets with a total value of not less than £250,000. 3For this purpose:3
- (a)
3net assets do not include:
- (i)
the value of the personal current account customer’s primary residence or any loan secured on that residence;
- (ii)
any rights of the personal current account customer under a qualifying contract of insurance within the meaning of the Regulated Activities Order; and
- (iii)
any benefits (in the form of pensions or otherwise) which are payable on the termination of the service of the personal current account customer or on their retirement and to which the personal current account customer (or the personal current account customer’s dependents are), or may be, entitled; and
- (i)
- (b)
“previous financial year” means the most recent period of one year ending on 31 March.
- (a)
- (3)
An “excluded account” is a personal current account that is offered on terms that:
- (a)
an agreement which provides authorisation in advance for the banking customer to overdraw on the account cannot arise; and
- (b)
either:
- (i)
the account cannot become overdrawn without prior arrangement; or
- (ii)
no charge is payable (by way of interest or otherwise) if the account becomes overdrawn without prior arrangement; and
- (i)
- (c)
no charge is payable where the firm refuses a payment due to lack of funds.
- (a)
- (4)
an “arranged overdraft” is the facility provided for in an authorised non-business overdraft agreement that is a regulated credit agreement.
- (5)
an “unarranged overdraft” is a regulated credit agreement that arises as a result of:
- (a)
a personal current account becoming overdrawn in the absence of an arranged overdraft; or
- (b)
the firm making available to the banking customer funds which exceed the limit of an arranged overdraft.
- (a)
- (1)
12The definition of “personal current account” refers to the definition of a “payment account” under the Payment Accounts Regulations, that is: “an account held in the name of one or more consumers through which consumers are able to place funds, withdraw cash and execute and receive payment transactions to and from third parties, including the execution of credit transfers, but does not include any of the following types of account provided that the account is not used for day-to-day payment transactions: savings accounts; credit card accounts where funds are usually paid in for the sole purpose of repaying a credit card debt; current account mortgages or e-money accounts”. The FCA has issued guidance on this definition: see ‘FG16/6 – Payment Accounts Regulations 2015’.
[Note: https://www.fca.org.uk/publications/finalised-guidance/fg16-6-payment-accounts-regulations-2015-definition-payment-account]
- (2)
The definition of “personal current account” for the purposes of this chapter is different to that used in BCOBS 7, because “premium service accounts” as defined in BCOBS 7 are not excluded from the definition of a personal current account in this chapter.
Purpose
12This chapter requires a firm to:
- (1)
make available a cost calculator tool on its website or mobile telephone application in accordance with BCOBS 8.2;
- (2)
make available an overdraft eligibility tool on its website or mobile telephone application in accordance with BCOBS 8.3; and
- (3)
provide alerts to personal current account banking customers about their personal current account usage in accordance with BCOBS 8.4.
Who and what?
- (1)
12This chapter applies to a firm that provides or offers to provide personal current accounts with respect to the provision of retail banking services, arranged overdrafts and unarranged overdrafts in connection with those accounts.
- (2)
This chapter does not apply to a firm if all personal current accounts provided or offered by the firm are excluded accounts.
- (3)
This chapter does not apply to a private bank.
- (4)
3This chapter does not apply in relation to an account which may be used for a currency other than a currency of the United Kingdom.
- (1)
12In accordance with BCOBS 1.1.5R this chapter does not apply to a credit union.
- (2)
BCOBS 8.3 (overdraft eligibility tool) applies:
- (a)
to a firm in relation to a trading name if 70,000 or more personal current accounts are held with the firm under that trading name, unless all personal current accounts provided or offered by the firm under that trading name are excluded accounts; and
- (b)
to any other firm to which this chapter applies and that chooses to offer an overdraft eligibility tool.
- (a)
- (3)
BCOBS 8.4 (Alerts) applies to a firm in relation to a trading name if 70,000 or more personal current accounts are held with the firm under that trading name.
- (4)
BCOBS 8.4 (Alerts) continues to apply to a firm in relation to some personal current accounts if the number of personal current accounts held with the firm falls below 70,000 but the firm has previously informed customers they will receive alerts, in accordance with BCOBS 8.4.6R.
Where?
12BCOBS applies only to the activity of accepting deposits from banking customers carried on from an establishment maintained by a firm in the United Kingdom, and activities connected with that activity (see BCOBS 1.1.1R). This chapter does not therefore apply to activities carried on from branches outside the United Kingdom.