Charity bank accounts - is yours the best one?

SCVO have just updated our charity bank account comparison table which we do every year. This offers a chance to remind trustees that they should also be regularly reviewing the financial management of their organisation to ensure it’s as effective as possible.

OSCR have some great guidance on Banking for Charities and both Control and Effectiveness are two of the five principles of the Scottish Governance Code. Financial control is a collective responsibility of all trustees and not just the job of the Treasurer. So at your next board meeting, why not suggest you have a look at whether your organisation’s bank account is the best one for your organisation’s needs?

Some questions to ask include:

• Does your account offer online dual authorisation? To protect against fraud, any online payments should be approved by at least two people for additional security.
• Are the terms and conditions clear on how you change a signatory if one of your trustees leaves?
• Do you get free banking if in credit? Or could you be getting a better deal elsewhere?
• What about ethical banking? Should you consider how your bank’s social and environmental stance fits with your charitable objectives?

The SCVO charity bank account comparison table highlights smaller banks which specialise in running accounts for community groups and charities, as well as featuring some of the high street banks. These smaller banks are definitely worth considering, especially if you have concerns about ethical banking. Of course you need to choose a current account which provides the services you need, but as a trustee you should consider whether your bank’s ethos and activities reflect your organisation’s charitable objectives. Determining ethics can be subjective but a good place to start can be to look at your mission and then try to ensure your bank’s practices don’t run contrary to that.

It’s vital for good governance that you look after your organisation’s assets and ensure they are used as effectively as possible. We can be complacent and stay with the bank we’ve always been with. But why, if it’s not coming up with the goods? Organisations with a turnover of less than £6.5 million and fewer than 50 employees can use the free Current Account Switch Service which makes the process simple and stress free.

So put a review of your bank account on the agenda for your next board meeting and have a look to see if the bank you’re with really is the best fit for your organisation.