Your weekly report from LWN [LWN.net]

Your weekly report from LWN

Posted Nov 6, 2002 21:04 UTC (Wed) by xoddam (subscriber, #2322)
In reply to: Your weekly report from LWN by stuart
Parent article: Your weekly report from LWN

Kids of 16 have debit cards? My!

<rant>

In the UK for some astonishing reason you need proof
of address and a reference from an employer before you
can open a bank account. No job, no account. This is
very costly for the most vulnerable people : you have
to use cash which actually encourages black-market,
below-minimum-wage employment and other dubious
income sources; this *discourages* regular employers
and makes it very hard to get that employer's reference.
People without bank accounts can pay 20% extra for
public services such as gas, electricity and
the telephone, and have to carry cash for all these
purposes (and rent and council tax if they're so lucky)
which increases the risk of being robbed or being
reckless with what little money you do have.

</rant>

In .au I had a bank account when I was seven and a
debit card at eleven. No money to speak of, but all
the wherewithal to use it efficiently when it came in.

New US/UK-style debit cards work perfectly anywhere a
credit card would, just tap in the number and LWN gets
your money (eventually :-). It's people from early-adopter
countries whose debit cards don't look like credit cards
who can't pay this way.

(Log in to post comments)

non-current account?

Posted Nov 7, 2002 15:04 UTC (Thu) by xoddam (subscriber, #2322) [Link]

Perhaps I'm not sufficiently familiar with all the terminology.

What sort of bank account can be 'upgraded' to a current
account, and how does it differ from a current account?
I was certainly told I couldn't open any sort of account
without an employers' reference, but then I was a foreigner
and over 18.

Maybe British minors get some sort of exemption, but I'm
sure I've never seen a child use a cash machine or a card
at a checkout in Britain.

non-current account?

Posted Nov 8, 2002 11:19 UTC (Fri) by Wol (guest, #4433) [Link]

Q) What sort of account can be upgraded to a current account?
A) A current account for minors.

The score with UK bank accounts is simple. It is a legal requirement to provide a proof of identity, and a proof of address, when you open an account. Seeing as we don't have any form of official identity other than a passport (only required if you travel abroad) this can catch many Britons, who have no "legally acceptable" proof of identity/address.

It is also illegal to seek to enforce debts against minors (under 18s). So banks don't give minors the ability to go overdrawn.

Within those constraints anyone can open any account. There's no reason why children can't have debit cards, provided the technology is there to provide instantaneous verification. That's probably why you don't see many children using plastic - so much of our banking system relies on end-of-day verification. But my step-daughters have been using cash machines for years - and the eldest turned 18 only last year. It's just that they could only use a Building Society card in the Society's own machines, because real-time checking wasn't available to other cash machines :-(

Cheers,
Wol

OT: non-current account?

Posted Nov 8, 2002 16:03 UTC (Fri) by robot101 (subscriber, #3479) [Link]

Certainly in my early teens I had live-balance-checking cash and debit cards on networks like Plus which changed to Visa Electron and Solo which is on the Switch network. Shops that take Solo are becoming more common, but Visa Electron is still pretty few and far between.

The Link network of cash machines does live balance checking, and most of my cards have supported that, so since I've had a real bank card I've been able to use it at most banks and in some shops. I didn't need to be 18 or have a job.

Incidentally, I did manage to get accounts overdrawn once or twice, once with a standing order they paid out on my account at the wrong time, and another by spending in a shop with the solo card and then using a cash machine very soon after. In the former case they put my balance to 0 because it was their fault, in the latter they sent me a nasty letter so I had to go and pay money in to my account, but I got them to repay the charge they gave me for sending the nasty letter. =)

Being a student now they're happy to give me a huge overdraft and Switch or Visa debit card to indebt myself as much as I want, and being 18 I can get a credit card if I wanted too. Evil people.

Regards,
Rob

Your weekly report from LWN

Posted Nov 14, 2002 11:57 UTC (Thu) by gerard (guest, #1478) [Link]

"In the UK for some astonishing reason you need proof of address "

Most all (even the USA) require proof of identity & address to open/operate bank accounts. Tis prevent money laundering.

"New US/UK-style debit cards work perfectly anywhere a credit card would"

Not true, Many debit cards are only be used in Country of Origin, also many are for "ATM Use only".

Until last year, many UK "Swith/Solo" cards were UK & ATM only.

Gerard