15 January 2024 , 15:51
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Virgin Money has become the latest high street bank to scrap passbook savings accounts which will affect 100,000 customers.
The bank, which has around two million customers, is set to tell around 100,000 of them that they will no longer be able to use their passbooks to pay in or withdraw cash in person. Virgin Money says the "vast majority" of customers can keep their passbook savings account however it will now operate as a statement-based account instead of using a passbook, but all the features remain the same. However, for a small proportion of customers where this isn't possible, they will move to an alternative savings product either online, offline or in store.
Passbook savings accounts let you keep track of deposits, withdrawals and balances in a booklet rather than a bank statement. Passbooks or bankbooks were the original savings accounts before electronic banking and they have fallen out of favour over the last few decades as banking moved online. However, passbooks are still mainly used by older banking customers.
A large number of high street banks scrapped passbooks a while ago including Santander, Barclays and Nationwide - who no longer offer them to new customers. Lloyds Bank - who owns Halifax - announced it was to scrap passbooks for around three million people last year. A further 500,000 would be scrapped with Lloyds Bank and the Bank of Scotland.
A Virgin Money spokesman confirmed it was "in the process of removing" passbooks adding: "As there are now more secure and convenient ways for customers to manage their money, including offline and in-store options, passbook accounts have not been available to open for a number of years."
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Virgin Money has not confirmed the date on which customers will be unable to use their passbooks and The Mirror will update this article when we know more.
The decisions by banks to scrap passbooks have sparked concern that the elderly could be digitally excluded if they are not able to do their banking online. James Daley of the campaign group Fairer Finance said: "Going into a branch with a passbook is how many of them have done their banking for their whole lives – it's all they know."
James also noted that if banks are scrapping this form of finance management they will need to offer options so that the "most vulnerable customers" can continue to access their money. The news comes as more banks announce closures to branches cross the county. Most recently, Barclays announced the closure of another 20 bank branches. You can see the full list of bank branch closures in 2024 in the Mirror's round up here.