90-day notice rule applies to accounts opened on or after 28 April 2026

Banks must give at least 90 days' notice and a clear reason before terminating an account opened on or after 28 April 2026, under rules that took effect on that date¹. For accounts opened before 28 April 2026, banks must give at least two months' notice and have no obligation to give a reason for the closure¹.

The change comes from The Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025, which the government made on 12 June 2025². The regulations amend the Payment Accounts Regulations 2015, which now set notice of "at least 90 days before the termination enters into force" for a framework contract entered into on or after 28 April 2026, against "at least two months" for contracts entered into before that date³. The Payment Services Regulations 2017 were also amended on 28 April 2026 by the same instrument⁴.

The 90-day rule applies to accounts opened on or after 28 April 2026¹. The government describes the change as requiring firms to give "a sufficiently detailed and specific reason for closing a basic bank account" and extending "the minimum notice period of termination from two months to 90 days"².

Exceptions remain. Where a bank suspects fraud, or where the customer is or has been abusive, banks can give less notice¹. Where a bank is concerned about financial crime, Section 333A of the Proceeds of Crime Act 2002 makes it an offence for the bank to tell anyone, including the customer, that an investigation is taking place if doing so may affect it¹. Banks are legally required to close accounts when they suspect use for financial crime, and must close accounts where they cannot complete know your customer checks required by the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017¹.

Basic bank accounts carry additional restrictions. A basic bank account opened under the Payment Accounts Regulations 2015 may only be closed without the consumer's consent in limited circumstances, for example if the consumer has knowingly used or attempted to use the account for illegal purposes, or if there has been no transaction for more than 24 consecutive months². As of 30 June 2024, there were 7,039,100 basic bank accounts open at the nine designated institutions². Basic bank accounts must be fee-free for standard operations when provided in sterling and must not have an overdraft facility².

Why it matters for households

The notice period and the reason requirement depend on when the account was opened, not on when the closure happens. Someone whose current account was opened before 28 April 2026 still sits under the older two-month rule with no right to a reason, even if the bank moves to close the account later¹. Anyone opening an account from that date onwards falls under the 90-day rule¹.

The Financial Ombudsman Service says that if an account was opened on or after 28 April 2026, the bank should explain why it closed the account if it can⁵. It adds that a bank is not allowed to treat a customer unfairly or close an account because of bias or discrimination, must follow the account's terms and conditions and its statutory, regulatory and legal obligations, and must give reasonable notice⁵. Complaints about account closures can be escalated to the ombudsman, which can consider losses such as missed standing order or direct debit payments, being unable to access banking facilities, and negative information on a credit file resulting from the closure⁵.

Banks are generally free to close customer accounts but must not discriminate against customers based on protected characteristics under the Equality Act 2010, and cannot discriminate against retail customers on characteristics in the Payment Accounts Regulations 2015¹. The Financial Conduct Authority reviewed payment account closures in September 2023 and found the most common reason for closing or suspending an account was that it was dormant or there was concern about use for financial crime¹.

What happens next

The 90-day notice and reason requirements apply to contracts entered into on or after 28 April 2026, when The Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025 came into force². HM Treasury has committed to publishing basic bank account data annually². No further commencement dates for these provisions have been reported.