The Swedish Financial Supervisory Authority (Finansinspektionen) found in a survey that almost 160,000 Swedes had their bank accounts closed between 2020 and 2022.
In 2020, banks in Sweden closed 45,000 accounts on their own initiative, followed by 54,000 the following year and as many as 60,000 bank accounts in 2022 – a 33% increase in just two years.
No statistics are available for 2023 and 2024 – so it is not yet clear whether bank account closures in Sweden have continued to increase since then.
The purpose of Finansinspektionen’s survey is described as seeing how the banks handle their statutory obligation to offer payment accounts to consumers, and it is a bleak picture that is presented:
“The number of consumers having their payment accounts closed has increased by 30% in recent years. At the same time, banks continue to refuse consumers to open accounts at the same rate as before. Banks’ most common reason for refusing and closing accounts is lack of customer awareness”, it notes.
Alternative solutions
FI notes that the negative consequences for an individual who is refused an account or thrown out of the bank are very high, and that more needs to be done to improve their handling.
Although banks are certainly obliged to counteract suspected money laundering and terrorist financing, FI believes that there are often better alternatives than completely excluding people from the bank.
In doubtful cases, it suggests, for example, that monitoring of the customer’s transactions should be intensified or that appropriate limits should be introduced.
“FI believes that banks need to work purposefully to lower the thresholds for obtaining an account that can at least be used for certain everyday needs”, it writes.
“Serious consequences”
The report also looked at how banks handle offers of payment accounts to businesses. Although there is no legal obligation to offer companies bank accounts in the same way as private individuals, FI emphasizes that they should not be denied accounts with the banks lightly either.
“At the same time, companies’ access to financial services is also of great practical importance. Being denied a payment account often has consequences for the individual company that can be very serious”, it states.
When banks close their customers’ accounts, they usually claim that they have not been able to achieve “adequate customer due diligence” and that customers’ answers to various questions and wording are deemed “inadequate”.
However, evicted consumers have a different view and say that it is very difficult to have a constructive dialog with the bank, or to have any dialog at all.
Difficult for those affected
FI also notes that “consumers who, for various reasons, have unusual transaction patterns or make transactions that are deemed to involve a higher risk appear to have their payment accounts terminated to a greater extent than before”. This could include, for example, repeatedly withdrawing or depositing cash, or trading cryptocurrencies.
It also shows that only a fifth of Swedes who request a review of the bank’s decision are ultimately successful – and that it is very difficult to even get a decision from the bank that can be reviewed.
“Consumers are often asked to complete their applications, which means that an application is not considered complete. This means that the consumer does not receive a rejection or information on where to lodge a complaint. In practice, this makes it difficult for consumers to submit an application and they cannot, within the framework of a completed application, question whether the requested supplements are relevant or not”, FI writes.
In conclusion, the administrative authority states that “there is still a need to strengthen consumer protection” and states that it “will continue to work to improve access to payment accounts”.
