De-banking update – new de-banking rules now in force

Why we think there could still be issues with new de-banking rules

Throughout 2024, 2025 and 2026 we wrote extensively about de-banking, including our articles titled “What are the proposed new laws aimed at preventing de-banking?”, “Why the proposed new laws to try and prevent de-banking do not go far enough” and, more recently, “De-banking continues to rise in the UK”.

Unfortunately, throughout 2025 and 2026, we continued to be approached by individuals who feel that they have been unfairly “de-banked”, which is an incredibly frustrating situation to find yourself in.

We have previously outlined the steps that individuals who feel that they have been de-banked can take. This includes making a formal complaint to the relevant bank, accompanied by a Data Subject Access Request (“DSAR”).

We have previously written about the new rules, set to come into force in 2026, to try and assist customers in de-banking situations:

What are the new rules announced by the Labour Government aimed at preventing potential de-banking situations?

Broadly, we noted that the new rules will extend the notice period a bank must give to close a customer’s account (i.e. de-bank a customer) from the current two months to 90 days.

Additionally, the new proposed rules will provide more transparency on the bank’s decision-making process by requiring the banks, in the right circumstances, to provide more reasons for their decisions to de-bank a customer.

In brief, what are the key changes under the new de-banking rules?

 As we have previously explained, the new rules will:

• require banks and service providers to give customers at least 90 days’ notice (up from the previous 60 days) before closing an account;
• require banks and service providers to give “sufficiently detailed and specific” written explanations of their decision to close a bank account;
• not be applicable in circumstances where the bank must close an account to comply with financial crime obligations (e.g. anti-money laundering obligations);
• be largely applicable to contracts concluded from 28 April 2026 (i.e. shall not be applied retrospectively).

When do the new de-banking rules come into effect?

The new rules come into effect on 28 April 2026.

Could there be any issues with the new rules?

From our perspective, yes, there could indeed be a number of issues.

For example, as we have previously explained, although the new rules will go further in addressing some of the iniquities in certain de-banking decisions, the whole approach to providing adequate access to a bank account and banking facilities needs to be radically reconsidered, making it akin to a fundamental right rather than something that can be offered (and taken away) at the whim of the banks.

The new rules are expected to apply to contracts concluded on or after 28 April 2026, and they will not therefore have retrospective effect.

What can I do to try and challenge a wrongful decision to close my personal and/or business bank account(s)?

In the meantime, we are increasingly being approached by individuals who have been “de-banked” in circumstances where they believe that they have always acted in full compliance with the relevant bank account’s Terms and Conditions and all other legal and applicable rules and regulations.

We have previously written about how other issues which individuals may face, including account closures, are not limited to political figures in the UK and affect many thousands of lawful individual and business customers every year. These cases have exposed the difficult balance many financial institutions and their individual and business customers must navigate to gain and maintain access to basic banking services.

To assist those whose accounts have been closed, Gherson’s Financial Crime, Investigations and Regulatory team have previously written blogs titled:

• “Why has my bank account been closed?”
• “Why has my business bank account been closed?”
• “140,000 SMEs “de-banked” last year – why could I have been de-banked?”
• “What are the proposed new laws aimed at preventing de-banking?”
• “Why the proposed new laws to try and prevent de-banking to not go far enough”
• “Am I entitled to a basic bank account in the UK?”
• “How to challenge crypto-related bank account closures”
• “De-banking and crypto – will the landscape be positively changed by the introduction of new rules for both?”
• 2025 – A year in de-banking
• De-banking continues to rise in the UK

What can I do to try and challenge a wrongfully imposed CIFAS marker?

We are also being increasingly approached by individuals who feel that a financial institution has wrongfully imposed a CIFAS marker in their name.

If you have always acted in full compliance with the relevant bank account’s Terms and Conditions and all other applicable legal rules and regulations, then you should have a good basis to challenge the bank’s decision to implement any CIFAS markers.

A strong challenge will often involve demonstrating, through evidence, that you have not breached the bank’s Terms and Conditions or rules, and that all transactions were at all times done in full compliance will all applicable laws and regulations.

In a previous blog, we examined what a CIFAS marker is and how to try and get it removed, as well as what you can do if a CIFAS marker has been wrongfully imposed.

We have also recently examined Challenging a crypto-related CIFAS Marker: what you can do.

NAVIGATING FINANCIAL INSTITUTION-RELATED CHALLENGES

Adverse information on compliance databases

We are also being increasingly approached by individuals who feel that incorrect and/or inaccurate data stored about them in compliance databases is having an adverse effect on their relationship with financial institutions and who are facing subsequent issues, such as bank account closures or difficulties in opening a bank account.

We have also written a series of blogs covering the main functions of compliance databases like World-Check and how you can correct information about yourself on such databases.

HOW GHERSON CAN ASSIST

Gherson’s Regulatory, White-collar and Investigations team are highly experienced in providing assistance on what you can do if your bank freezes or closes your account. This includes assisting you in submitting a request under data protection legislation, otherwise known as a Data Subject Access Request, to ascertain what information banks and other financial institutions may be holding on you and their decision making, and then analysing the response and assisting with any appropriate challenge.

If you would like to speak to us in respect of any of the issues raised in this blog or about your specific circumstances, do not hesitate to contact us for advice, send us an e-mail, or alternatively, follow us on X, Facebook, or LinkedIn to stay-up-to-date.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

©Gherson 2026