CHANGE YOUR BANKACCOUNTTO A BUILDING SOCIETY ACCOUNT BEFORE APRIL 1ST 2013 IF YOU ARE ON BENEFITS
Big changes are ahead with the benefit system. Don’t be caught with the wrong account!
Do not use a bank account to receive your benefit money, use a building society or credit union account instead.
To protect yourself make sure you have your benefit paid into an account that does not make charges.
Switch to a building society account, a credit union or some other account that does not apply charges.
Otherwise you could lose your money and be left penniless for a whole month or more.
This is the advice of Nucleus and other advice agencies ahead of the changes to benefit system in April 2013 when the risk to benefit claimants will become even greater.
Cuts in benefits are approaching. On a tight budget, a reduction in your weekly or monthly benefit could push you into debt by creating an overdraft at the bank
So change your benefit account to a building society or credit union account before April 1st 2013
THE DANGER OF BANK CHARGES
The hidden danger to benefit claimants is in bank charges. Since 2004 all people receiving benefits have been urged by the Government to have their money paid into a bank account. However, serious problems arise where banks impose charges – for example if your account slips into the red and you do not have an agreed overdraft facility.
This is a particular risk for newly unemployed people who have not encountered the problem before. Also at risk are elderly people and people who become ill. These claimants can end up losing all their week’s benefit money in bank charges and fees for unplanned overdrafts.
This is a risk to anyone receiving Job Seeker’s Allowance, Pension Credit, Income support,ESA or any other benefit that goes into a bank account. As a result of bank charges being imposed you can end up losing all your money – even if it is not your mistake. Bank charges for overdrafts can be like invisible vampires sucking all your money away. It means that you lose all your benefit money in paying bank charges and you won’t get it back.
With the move to Universal Credit, this risk to benefit claimants who get their money paid into bank accounts is increased. Everyone on benefits is strongly advised to open up a building society or credit union account to receive their benefits.
The dangers of having your money being paid into a bank account will increase with the Government’s new Universal Credit system.
Reasons for this include
- Universal Credit is an untried system – computer errors in payment are to be expected
- Universal credit will be paid be paid monthly rather than weekly – you could end up losing an entire month’s benefit in bank charges in one go, with rising charges until the next payment.
- If Universal Credit does go wrong you could end up with an unplanned overdraft if no money is paid until the problem is sorted out
- Under banking law the banks will be able to deduct from your Universal Credit if you have another debt to the same bank
WHAT TO DO
If you do have your benefits paid into a bank account change this as soon as possible. There are plenty of building societies who will be eager to have your custom instead of the bank and they won’t charge you for it.