Have you been debanked? Email [email protected].

Almost half a million customers were debanked last year, the highest figure in a decade, as account closures continued to spike.

An estimated 453,230 accounts were shut down, according to figures released to The Telegraph under Freedom of Information rules. This was a more than tenfold increase on the 45,091 accounts closed in 2016-17, and an 11pc jump on the 408,000 accounts closed in the 2023-24 tax year.

In all of the cases, lenders cited “financial crime reasons” for the decision to close accounts.

Nigel Farage, who was himself controversially debanked by private bank Coutts in 2023, described the figures as “appalling” and blamed European legislation, which he claimed “makes it cheaper for banks to close accounts over unusual transactions”.

It comes ahead of the introduction of new rules which will force lenders to give customers longer before they close accounts – at least 90 days’ notice – as well as offer clearer explanations of why they shut the accounts.

But the requirements will only apply to accounts opened after April 28 this year and will be subject to exemptions to allow banks to comply with financial crime rules.

Financial institutions are allowed to close accounts for commercial reasons, and if they suspect criminal activity. There is no legal right to a bank account in the UK, unlike in countries such as France and Belgium.

Banks have faced criticism over their failure to explain to customers exactly why accounts have been closed. This is often blamed on anti-money laundering and other financial crime rules which lenders must follow.

Anti-money laundering rules were substantially tightened in 2017, requiring banks to monitor customer activity and check identities. The rules mean that banks which suspect customers are engaging in criminal activity cannot tell them why their accounts are being closed.

The National Crime Agency estimates that £10bn is laundered through the UK’s banking systems every year.

In December, the Financial Conduct Authority (FCA) fined Nationwide £44m for ineffective warning systems, and for knowing that some customers were breaching its own terms.

In one case, Nationwide allowed a customer to receive 24 payments totalling £27.3m over 13 months into a personal current account. HMRC was unable to recover £800,000 of the payments.

Since 2021, the city regulator has imposed 13 fines on banks for failing to observe money laundering rules, totalling more than £300m.

Another pressure point for lenders is rules introduced in October 2024 which require them to reimburse victims of authorised push payment (APP) fraud.

In the first half of last year, lenders repaid in 88pc of cases, totalling more than £84m, with the vast majority of refunds paid out within days. Experts previously told The Telegraph that the reimbursement rules could be driving higher numbers of account closures.

James Graham, a senior researcher at think tank the Prosperity Institute, said: “The continued rise in account closures, as shown by this new data, shows that the debanking epidemic remains a present and real danger for increasing numbers of British citizens.

“Preventing crime sounds noble, but nobody believes another 453,000 people are financial criminals, on top of the 408,000 in 2024, and 317,000 in 2023.”

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Maxwell Marlow, of think tank the Adam Smith Institute, said: “The scourge of debanking continues to blight the British public and significantly impacts the Square Mile.

“Our finance system thrives through freedom – it is why we were the centre of global capitalism for so long, and we became rich from it. If we choose to reject these principles by ignoring this issue, our liberties and prosperity will be punished collectively.”

A UK Finance spokesman said: “Banks must comply with strict legal and regulatory requirements in terms of verifying customers and preventing financial crime. As a result, a small proportion of accounts are closed, but only after extensive review and investigation.”

A Treasury spokesman said: “Debanking is wrong, which is why we’ve put protections in place for millions of people and small businesses.

“Under the new rules, customers will receive at least 90 days’ notice and an explanation for any account closure, strengthening protections which prohibit banks from discriminating against someone based on their political opinions.”

An FCA spokesman said: “Fighting financial crime is one of our priorities. Fraud makes up over 40 pc of crime in the UK, robbing people of their hard-earned money.

“It’s important banks and building societies play their part, including closing accounts they have suspicions about. Only a tiny fraction of accounts are closed – and we expect firms to act proportionately and treat customers fairly.”

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