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NLJ this week: Debanking reforms mark a significant shift ahead for firms

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20 June 2025
Issue: 8121 / Categories: Legal News , Banking , Financial services litigation , Regulatory , Consumer
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The rules and regulations on debanking (where a bank terminates its relationship with a customer) are due to change next year. In this week’s NLJ, David Hamilton, partner at Howard Kennedy, sets out the likely changes and explores the implications for payment services firms

Hamilton writes: ‘Since Nigel Farage’s public spat with Coutts Bank in 2023, the issue of debanking has drawn sustained public, political and regulatory scrutiny, becoming emblematic of broader concerns around financial exclusion and institutional accountability.’

The amended Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025 (PSPA Regulations), due to apply from 28 April 2026, aim to strengthen protections for consumers and micro-enterprises when payment firms ‘debank’ them. Consequently, Hamilton says, payment services firms may be prompted to adopt a ‘more conservative risk appetite’. 
Issue: 8121 / Categories: Legal News , Banking , Financial services litigation , Regulatory , Consumer
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