5 ms·

I would try Monzo, but all I get from them is > Unfortunately we can't offer you a Monzo account > We're afraid we can't go into more detail about why we can'

I would try Monzo, but all I get from them is > Unfortunately we can't offer you a Monzo account > We're afraid we can't go into more detail about why we can't offer you an account. > We assess every application using details you've given us, and any information we get from the credit reference agencies we use (Experian and TrnsUnion) or from anti-fraud services like Cifas. Starling is the same. As a debt-free UK resident without any UK driver's licenses, utility bills, benefit claims, gun certificates, electoral register or GP records, the only bank that is willing to do business with me is Revolut. Not having any credit history is becoming a barrier to access more and more services that require an identity check. While it is understandable that companies want to protect themselves from fraud, this trend is making it difficult for people who don't have a credit history to access basic services. This is creating a significant barrier for certain groups of people, and it is something that should be addressed. When it comes to providing essential services to those who fall through the cracks, Revolut may be more ethical than the other options.

raesene9 4y ago
The problem of lacking credit history has been around for a long time, I remember getting a credit card, which I paid off in full every month, just to increase my credit score ~ 20 years ago. For people without a good credit history in the UK there is meant to be "basic bank accounts" which don't require credit checking as they don't offer overdrafts (https://www.moneyhelper.org.uk/en/everyday-money/banking/basic-bank-accounts https://www.moneyhelper.org.uk/en/everyday-money/banking/bas...) That said, you will still need proof of identity/address. If a bank is taking you on without those, I'd struggle to see how it's meeting KYC (Know your customer) requirements.
- Nextgrid 4y ago
  As far as I know the aforementioned banks merely check for a credit bureau record (and absence of any fraud markers) to use for KYC as opposed to for credit eligibility, so if he's being rejected for those his problem is not creditworthiness but the complete lack of CRA record. It's unlikely he'll qualify for any credit card with absolutely zero records. His best bet is to open an account at a brick & mortar bank which will be able to verify his identity using physical documents and not only skip the CRA check, but actually create a CRA record (which can be a good or bad thing depending on your opinions regarding privacy). After a year or so, he should become eligible for those accounts accounts (if the lack of CRA record is truly what caused them to reject initially) and even qualify for a credit card if needed.
  - jozvolskyef 4y ago
    Thank you for your insightful comment explaining how the CRA process works. I'm not interested in credit, but it is good to know that it takes a year merely to qualify for a score. Last year, I stuffed every document I owned into a folder and went to a brick & mortar bank to open an account. No dice. The customer adviser went through some kind of a decision tree and told me that my best bet is to apply for benefits if I am eligible, saying that I just need to show them some letter without claiming the benefit. It is absurd. If wearing an ankle tag for a month to prove my address was an option, I'd go with that.
    - Nextgrid 4y ago
      > but it is good to know that it takes a year merely to qualify for a score. Technically it doesn't - banks leak your details to CRAs upon every major interaction (account application, etc) and regularly confirm them if they have a continued relationship with you (if you have an account open they'll typically report the status of the account every month). However other banks may still be suspicious of a brand new record and might want to wait a few months before trusting it (since if the record was created fraudulently, it will usually get discovered and rectified pretty early - if the record is there for a long time, either it's legit or the fraudster has done an above-average job). The "one year" number is purely arbitrary but feels fair to me, that's probably what I'd do if I was building such a system (though I'd also build an escape hatch to allow people to confirm identity differently without CRA scum being involved). Furthermore, in the UK there is no concept of "credit score". It's a myth perpetuated by the CRAs just so you obsess over that meaningless number that they can tweak every month to give you a reason to keep coming back and look at their "offers". In the UK, lenders get your raw report (aka identity, address history, recent credit applications and their status, open accounts, etc) and then make a decision internally based on their own algorithms.
  - raesene9 4y ago
    The page I linked gives that info for the UK :) including alternative identity proof where traditional information might be lacking. The page also lists the banks which provide the "basic bank account" service, which scanning down them appear to be primarily traditional ones (although with branch closures in the UK that's getting less like bricks and mortar by the year.)
calcifer 4y ago
> the only bank that is willing to do business with me is Revolut. That's because Revolut isn't a UK bank. Until very recently (less than a year ago), it wasn't a bank at all anywhere. Unlike Monzo, Starling et al. (which are UK banks) Revolut is an "electronic money institution" and hence your balance isn't protected by the Financial Services Compensation Scheme (FSCS).
- nsteel 4y ago
  I didn't realise this. Why would anyone accept this risk and use Revolut as anything more than a place for pocket money while abroad?!
  - Nextgrid 4y ago
    People who have no choice or don't know any better.
    - nsteel 4y ago
      I hope @mojuba is now aware of this. This is not a good "bank if you have other options. Going back to Monzo would be a better choice.
      - mojuba 4y ago
        They have recently become a real bank and converted the customers' accounts to real current ones. They are a UK bank though due to Brexit for EU-based customers they are a Latvian one (I think).
        nsteel 4y ago
        Perhaps it is different for the UK part. According to https://www.fscs.org.uk/check-your-money-is-protected/ https://www.fscs.org.uk/check-your-money-is-protected/ Revolut Ltd money is not protected: > Money at risk > Reason why > Revolut Ltd is an e-money institution. FSCS can't provide protection if an e-money institution fails. Money in Revolut savings accounts ("vaults"?) is apparently protected as that money is held with real banks, not Revolut Ltd.
Nextgrid 4y ago
If you want another option, check out TransferWise - they should be able to open you an account as well.
nsteel 4y ago
Have you tried Chase UK? They are an app-only bank but don't offer any lending so the checks should be more relaxed. They claim to accept an EU photo ID card if you have one of those.
PebblesRox 4y ago
> Not having any credit history is becoming a barrier to access more and more services that require an identity check. Agreed. My husband and I are against debt on principle and it really irritates me that credit history is being used for identity checks. I accept the trade off that a lack of credit history would make it more difficult for me to get credit in the future, but it should not affect my access to non-debt-related services. We’ve already encountered this problem once [0] and I’m concerned that it will become even more of an issue going forward. [0] My husband was not able to create an online account with the social security administration because their identity system didn’t have enough info on him to even attempt to verify his identity. He couldn’t even go in person to set it up because the local office was closed due to COVID.

raesene9 4y ago

The problem of lacking credit history has been around for a long time, I remember getting a credit card, which I paid off in full every month, just to increase my credit score ~ 20 years ago. For people without a good credit history in the UK there is meant to be "basic bank accounts" which don't require credit checking as they don't offer overdrafts (https://www.moneyhelper.org.uk/en/everyday-money/banking/basic-bank-accounts https://www.moneyhelper.org.uk/en/everyday-money/banking/bas...) That said, you will still need proof of identity/address. If a bank is taking you on without those, I'd struggle to see how it's meeting KYC (Know your customer) requirements.

Nextgrid 4y ago
As far as I know the aforementioned banks merely check for a credit bureau record (and absence of any fraud markers) to use for KYC as opposed to for credit eligibility, so if he's being rejected for those his problem is not creditworthiness but the complete lack of CRA record. It's unlikely he'll qualify for any credit card with absolutely zero records. His best bet is to open an account at a brick & mortar bank which will be able to verify his identity using physical documents and not only skip the CRA check, but actually create a CRA record (which can be a good or bad thing depending on your opinions regarding privacy). After a year or so, he should become eligible for those accounts accounts (if the lack of CRA record is truly what caused them to reject initially) and even qualify for a credit card if needed.
- jozvolskyef 4y ago
  Thank you for your insightful comment explaining how the CRA process works. I'm not interested in credit, but it is good to know that it takes a year merely to qualify for a score. Last year, I stuffed every document I owned into a folder and went to a brick & mortar bank to open an account. No dice. The customer adviser went through some kind of a decision tree and told me that my best bet is to apply for benefits if I am eligible, saying that I just need to show them some letter without claiming the benefit. It is absurd. If wearing an ankle tag for a month to prove my address was an option, I'd go with that.
  - Nextgrid 4y ago
    > but it is good to know that it takes a year merely to qualify for a score. Technically it doesn't - banks leak your details to CRAs upon every major interaction (account application, etc) and regularly confirm them if they have a continued relationship with you (if you have an account open they'll typically report the status of the account every month). However other banks may still be suspicious of a brand new record and might want to wait a few months before trusting it (since if the record was created fraudulently, it will usually get discovered and rectified pretty early - if the record is there for a long time, either it's legit or the fraudster has done an above-average job). The "one year" number is purely arbitrary but feels fair to me, that's probably what I'd do if I was building such a system (though I'd also build an escape hatch to allow people to confirm identity differently without CRA scum being involved). Furthermore, in the UK there is no concept of "credit score". It's a myth perpetuated by the CRAs just so you obsess over that meaningless number that they can tweak every month to give you a reason to keep coming back and look at their "offers". In the UK, lenders get your raw report (aka identity, address history, recent credit applications and their status, open accounts, etc) and then make a decision internally based on their own algorithms.
- raesene9 4y ago
  The page I linked gives that info for the UK :) including alternative identity proof where traditional information might be lacking. The page also lists the banks which provide the "basic bank account" service, which scanning down them appear to be primarily traditional ones (although with branch closures in the UK that's getting less like bricks and mortar by the year.)

calcifer 4y ago

> the only bank that is willing to do business with me is Revolut. That's because Revolut isn't a UK bank. Until very recently (less than a year ago), it wasn't a bank at all anywhere. Unlike Monzo, Starling et al. (which are UK banks) Revolut is an "electronic money institution" and hence your balance isn't protected by the Financial Services Compensation Scheme (FSCS).

nsteel 4y ago
I didn't realise this. Why would anyone accept this risk and use Revolut as anything more than a place for pocket money while abroad?!
- Nextgrid 4y ago
  People who have no choice or don't know any better.
  - nsteel 4y ago
    I hope @mojuba is now aware of this. This is not a good "bank if you have other options. Going back to Monzo would be a better choice.
    - mojuba 4y ago
      They have recently become a real bank and converted the customers' accounts to real current ones. They are a UK bank though due to Brexit for EU-based customers they are a Latvian one (I think).
      - nsteel 4y ago
        Perhaps it is different for the UK part. According to https://www.fscs.org.uk/check-your-money-is-protected/ https://www.fscs.org.uk/check-your-money-is-protected/ Revolut Ltd money is not protected: > Money at risk > Reason why > Revolut Ltd is an e-money institution. FSCS can't provide protection if an e-money institution fails. Money in Revolut savings accounts ("vaults"?) is apparently protected as that money is held with real banks, not Revolut Ltd.

Nextgrid 4y ago

If you want another option, check out TransferWise - they should be able to open you an account as well.

nsteel 4y ago

Have you tried Chase UK? They are an app-only bank but don't offer any lending so the checks should be more relaxed. They claim to accept an EU photo ID card if you have one of those.

PebblesRox 4y ago

> Not having any credit history is becoming a barrier to access more and more services that require an identity check. Agreed. My husband and I are against debt on principle and it really irritates me that credit history is being used for identity checks. I accept the trade off that a lack of credit history would make it more difficult for me to get credit in the future, but it should not affect my access to non-debt-related services. We’ve already encountered this problem once [0] and I’m concerned that it will become even more of an issue going forward. [0] My husband was not able to create an online account with the social security administration because their identity system didn’t have enough info on him to even attempt to verify his identity. He couldn’t even go in person to set it up because the local office was closed due to COVID.