Customers pledge to change banks

A new campaign will encourage customers to move their money in protest against unethical banks

As RBS boss Stephen Hester is forced to waive his £1m bonus in the face of growing political and public pressure, now banking customers are taking further steps to tackle the wider problem of what they see as an unfair baking system. Customers are joining a new grassroots campaign that is encouraging people to move their money from the big commercial banks to ethical, local or mutual financial institutions.

Going live this Tuesday, Move Your Money UK believes that the only way of securing a sustainable, accountable and fair financial system is through a shift in cultural attitudes both inside and outside of the financial sector.

“That’s up to us as citizens and consumers,” said a spokesperson from the campaign. “When people choose where they keep their money, they are choosing between supporting business as usual or taking a simple but powerful step towards a better banking system.”

The campaigners are asking people to no longer support banks that undertake “socially useless lending and risky speculation” and instead to use banks that lend to small and medium-sized businesses that produce useful goods and services, and that do not lend to companies that violate human rights or engage in environmental destruction.

According to the charity War on Want, the four biggest high street banks held £9bn worth of shares in arms companies in 2008. Meanwhile, it is estimated by the Financial Inclusion Centre and Cooperatives UK, that between 2009 and 2010 banks made £11.2bn from overcharging; £430 for every household in the country.

Florence Roberson, a 25-year-old waitress living in Bristol has her current account with NatWest but has decided to move her money to the Co-operative Bank or a local credit union after hearing about Stephen Hester’s bonus.

Florence said: “I joined NatWest when I was student because they offered a free young persons rail card and I’ve been with them ever since. I was outraged at Hester’s bonus announcement and its obvious that he would’ve accepted it if it wasn’t for the massive public pressure. I’ve got so many friends who have been to university, got a good degree but are still struggling to find work, and to hear that the CEO of a publicly owned bank was offered a bonus worth near £1m beggars belief.”

The campaign follows the Move Your Money Project in the US which has seen over 4 million people move their accounts to local banks since last September. The UK initiative is being supported by trade body Co-operatives UK.

Ed Mayo, Co-operatives UK secretary general said: “At an individual level, you can’t do everything to put an unfair economy right, but you can do something. Move your money is the new fair trade. It is the campaign for our time.”

The alternative financial sector has flourished in the aftermath of the financial crisis. Since 2007 Charity Bank has seen its deposits and balance sheet double in size. Triodos Bank, which invests in social enterprises and renewable energy projects and is fully transparent about which companies it lends money to, saw its balance sheet grow 30% in 2009 alone.

Meanwhile, savings in credit unions increased by 300% over the last decade according to Move Your Money. With the possibility of the Co-op becoming a major player on the high street, having bought up hundreds of Lloyds branches last year, the Move Your Money campaign believes that the alternative financial sector is now heading mainstream.