NatWest’s decision to charge charities for operating current accounts is causing "significant financial concern" to over 100 struggling charities.
NatWest is proposing to charge charities £10 per month and £2.50 per non-automated transaction. The Association of Guernsey Charities estimates that at least 120 of its members will be affected, and a large number have contacted them to express serious concern.
Peter Rose, Vice Chairman of the Association of Guernsey Charities, said the AGC had been in contact with senior management at NatWest to see if they would reconsider their decision, or simply waive the charges for registered charities, but had been rebuffed.
“I think that most charities affected will have to look to move their accounts, so as to avoid charges, but moving accounts is a cumbersome and bureaucratic process, taking time that would be better spent on charity missions," he said.
"This decision by NatWest is unfortunate, rather mean-spirited and the timing could not be any worse. It will take up to £20,000 a year out of charity funds at a time when most have been severely constrained from raising funds, purely for the benefit of NatWest’s profits."
A spokesperson for NatWest International said the new charges reflect the increasing cost of providing manual, branch based transactions. These costs need to be met so that digital services - which are free - can be developed further to make the business more sustainable.
New @Island_Global report today on Charitable Giving in Crown Dependencies shows degree to which donations & volunteering have been affected during Covid-19 emergency. https://t.co/smSSyBLyUb @Govgg @GovJersey @IOMGovernment #NeverMoreNeeded— Association of Guernsey Charities (@GuernseyCharity) April 8, 2021
Pictured: The Covid-19 lockdowns have limited in-person fundraising opportunities for charities.
However, a representative of the Monday Club said the reality for charities like their's is that the fees would become their second largest overhead after insurance.
“The proposed charges are disproportionate to the small size of our charity. Our general income from members' subs is only about £15-£20 a week during term time - just enough to cover weekly running costs.
"We rely on donations to cover other costs such as our annual insurance renewal fees and special events, so the proposed monthly fee will have a significant impact."
Dr Nick Paluch of Guernsey Aid said the charges "do seem quite punitive, especially for a sector that has also been badly affected by Covid.”
Sarah Felmingham of Guernsey Multiple Myeloma Support Group accused NatWest of ignoring their commitment to support the less fortunate in the community.
“I think that NatWest should be reminded of the challenges charities are facing, having struggled to fund raise in two lock-downs in the last 18 months, specifically when the corporate sector is putting ESG at the top of their priority list for 2021. Charging charities for banking is incongruous to this focus.”
Sandra Collins of The Guernsey Voluntary Service said digital services were not suitable for many of their clients.
”The charges will have a huge effect on the cost of running our services as our clients are elderly and they mainly pay bills and charges by cheque or cash.”
In response, a NatWest International spokesperson said there are “no hidden fees or charges designed to catch customers out.”
“We have made some changes to the way in which some of our non-personal customers are charged for their accounts to enable us to invest in our digital services and create a sustainable business that will be able to serve generations of business owners to come," they said.
"We do not take these decisions lightly, however the cost to provide some manual, branch based transactions is increasing per transaction and is reflected in the increase in charges. However, digital payments continue to be free for customers choosing to use our digital services.
“We value enterprise and are working with a number of our local businesses across our jurisdictions to support their needs outside of banking, around enterprise, as well as providing support to those businesses who are not yet using our digital services but would like to.
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