Making an ethical choice: why I stopped banking with Barclays
A few weeks ago, after several years of being a loyal and relatively satisfied customer, I walked into my local Barclays branch and closed down all the accounts I held with them. During my time banking there, I never had any real issues. Customer service had always been good. So what was the deal?
The crux of the matter was that it boiled down to the matter of ethics — poor ethical behaviour demonstrated by Barclays Bank Plc over the course of many years.
In this article, I will shed some light around the unethical practices at Barclays which caused me to make this decision, as well as providing an alternative solution for your UK banking needs, should you be a Barclays customer and be interested in switching.
Barclays — the UK’s most unethical bank?
I’m afraid so. Well second most unethical to be exact, according to Ethical Consumer.
Ethical Consumer, if you’re not familiar with them is an organisation that works hard to provide the tools and resources needed to allow you to make choices on products and services according to your personal ethics. They have developed a sophisticated and simple rating system based on detailed research of over 40,000 companies, brands and products providing a score from 1 to 20–1 being the least ethical and 20 being most.
Barclays current & savings accounts receive a score of 2, only barely beaten to the bottom of the league by Tesco current & savings accounts with 1.5. Here are some of the reasons why Barclays received such a low score:
1. Environmental reporting
While Barclays have made some strides towards reducing their carbon footprint, having hit certain environmental impact targets to be achieved by 2015, they have not continued this journey. There are no new targets that have been published on their website (note they still refer to the year 2016 as if it is a future date) and their environmental data provided has not been independently verified, which brings its objectivity to question.
2. Climate change
Barclays Plc has been linked to the fracking industry via their part-ownership of Third Energy, and they have provided significant funding to the coal mining industry with $2.3bn USD provided to the top 30 coal power producers in 2014 alone. Sadly what this means is that by banking with Barclays, you may be at risk of inadvertently funding these toxic industries. Barclays was also specifically targeted in the “Move Your Money” campaign for these reasons among others.
3. Political lobbying
Barclays has been heavily involved in lobbying, spending significant sums of money both within Westminster and Brussels to promote their interests around topics of finance and banking.
4. Tax avoidance
Barclays Plc has subsidiaries located in many “tax haven” territories such as Isle of Man, Guernsey, Monaco, Hong Kong, Mauritius and Switzerland. It can be assumed that they do this for the purposes of tax avoidance. In other words, leveraging UK infrastructure in order to run their business but without the will or intention to pay the tax owed for the benefits gained.
Many people will be aware that Barclays was caught up in a large scandal where they were fined £290m by US and UK regulators over the “Libor rate-fixing scandal”, as well as having mis-sold unnecessary payment protection insurance (PPI) to mortgage borrowers.
Barclays has done a lot since to clean up its act, with employees in 2013 famously being told to “sign up to ethics or leave”. From then on their bonuses would be assessed based on purpose and value criteria. Unfortunately, this mandate appeared to be short-lived with their latest CEO, Jes Staley, having pulled Barclays into yet another scandal this year.
After attempting to uncover the identity of an internal whistleblower that made allegations against one of his long-term associates, Staley claimed that he believed it had been perfectly acceptable to track down the author of the anonymous letter that he received. Such events really don’t provide employees with much confidence in their ability to be able to flag up unethical behaviour and practices witnessed without the possibility of facing repercussions afterwards.
In light of these points, I decided it was time to make a move and find a more ethical option.
An ethical banking choice: Metro Bank
Some months ago, I decided to open a current account with Metro Bank. Doing so was extremely straight forward:
Step 1: I went to my local branch
Step 2: I gave them my passport and 2 utility bills to be photocopied
Step 3: I signed a document and they opened my account
Some fun facts about banking with Metro Bank:
- When you open up your account, they print off your debit card right there and then, so you have it immediately.
- They have excellent opening hours made, for modern living as opposed to traditional banks. They are open evenings Monday to Saturday and open during the day on Sundays and Bank Holidays.
- Card transactions are free across Europe.
- They welcome dogs (and their owners) into their branches.
- They have coin counting machines intended for kids known as “Magic Money Machines”
It should be noted that Metro Bank actually isn’t the most ethical bank according to Ethical Consumer’s ratings. With a rating of 12.5, they are behind the most ethically rated bank, Triodos, who has a score of 14.5. Metro Bank loses points in environmental reporting and for political activities, due to its membership with the British Banking Association (BBA) who has lobbied against effective banking regulation within the UK and EU.
According to the Move Your Money campaign, Metro Bank has scored very highly for running an honest and tax-haven-free operation receiving very few fines or complaints, although they remarked that there is still room for improvement.
All things considered, Metro Bank are still 10.5 points ahead of Barclays according to Ethical Consumer, a clear improvement, and with all of that taken into account, and having had a very positive customer experience with Metro Bank so far, I finally decided to shut down my accounts with Barclays once and for all.
Saying goodbye to Barclays
The act of closing down my accounts with Barclays was extremely simple:
- I made sure to clear out any funds from my accounts.
- I visited my local branch and asked to speak to someone about closing my accounts.
- When I sat down with them, I gave them my debit card and entered my pin into the pin sentry machine they had.
- The person helping me spent some time tapping away at her keyboard and after a few minutes told me that it had all been taken care of.
Unfortunately at no point was I asked by staff in the bank as to why I had decided to leave. I felt it was only fair that they should know, so after I successfully closed my accounts, I sent them a tweet on Twitter to make sure they were aware, for whatever it was worth.
It’s your turn
It’s worth noting that a lot of the issues I mentioned in relation to Barclays also apply to other major High Street banks. So while you may not have an account with Barclays, it is worth considering how ethical your bank of choice is and whether it might be time to make a move based on ethical grounds.
I know it can be easy to just accept the status quo — it’s less hassle, right? But I bet you’re also at the same time unhappy with the banking industry as a whole and would like to see their practices overhauled?
Change starts with you. If more people started to revolt against the system like this, then banks like Barclays will ultimately either go out of business or finally have to change their ways for good.
Be a part of that revolution — what are you waiting for?
EDIT: On June 20th, 2017 just a few days after I published this article, it was announced that Barclays has been charged with fraud. Read about this here.
Useful resources
If you’re interested in learning more about opening a personal account with Metro Bank, you can find information here.
If you would like to learn more about the most highly rated ethical bank for current accounts, Triodos, you can do so here. Note: I made a personal choice not to go with Triodos as they do not have high street branches.
And if you’re passionate about making more informed and ethical choices in your day-to-day life, consider signing up to Ethical Consumer. Membership costs £29.95 a year and helps to fund the fantastic work they are doing around bringing to light unethical behaviour by some of the world’s biggest conglomerates. You can sign up to a 30 day free trial here.
