Bank transfer not allowed for "cash account"
I've recently reloacated to UK and opened a bank account to deposit my paychecks. As I didn't have a credit history, the bank allowed me to open a (what they call) "cash account".
Now, given that I have funds in it, it appears that I cannot transfer those funds to another account via bank transfer (my wife has account in the same bank) as cash accounts have this kind of limitation.
Now, as they claim that all the banks in UK do this for accounts without a credit history, is it true? Why?
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Why are you trying to send a wire transfer? Why not just a UK bank transfer.. you can send them just using the sort code and account number, I don't believe your bank would be allowed to block you from that, and it wouldn't make sense to as you need it to pay bills.
EDIT:
They are correct, it just seems they have been given a particularly poor offering by a bank. To anyone else in this situation, find another bank which offers any sort of basic bank account without an overdraft, and you will be quite likely to be offered an account.
If you can't get a new account, withdraw cash and deposit it wherever you need to transfer funds.
All major banks in the UK offer "cash accounts / basic accounts", this is to help people in a similar situation to you who either don't have any credit history or have a negative one but still allow them to bank convieniently thus avoiding financial exclusion in an ever-growing cashless society. Cash accounts are a good place to start and if you manage your account responsible (e.g do not go into an unplanned overdraft, consistently have wages paid in, maintain a balance through out the month (don't drop straight to £0)) after 3-6 months you will be eligible for other types of accounts which may offer benefits such as interest or insurances.
Cash accounts generally work the same as new accounts e.g. Allowing money to be paid in via employer, bills to be set up via direct debit, online/telephone payments/banking and lastly electronic money transfers. The main difference between cash and regular accounts being cash accounts do not have access to any borrowing facilities e.g overdraft or even cheque book.
Depending on the bank some place markers on new accounts prohibiting certain actions until they can see some form of banking behaviour e.g prohibiting electronic transfers or online payments. This is normal rectifiable by a quick visit to your local branch.
There should be no problem with your account it's just the bank being weary but a quick visit to your local branch can't hurt.
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