LONDON (Reuters) – Britons living in the European Union could lose access to their UK bank accounts and businesses on the continent could be cut off from investment banks in London if there is a no-deal Brexit, the British government said on Thursday.
FILE PHOTO: A Union Jack themed Visa credit card is seen amongst British currency in this photo illustration taken in Manchester, Britain March 13, 2017. REUTERS/Phil Noble/Illustration
In a document detailing contingency planning if Britain leaves the EU in March with no transition deal, the government said unilateral action on several fronts could only minimise disruption up to a point.
Over a million Britons living abroad may not be able to access their UK bank accounts to receive pensions and salaries, the document said.
All Britons will face higher costs to make card payments in the EU when travelling abroad.
The EU this year agreed to cap the fees retailers pay to process debit and credit card transactions. Without a deal between London and Brussels, the ban on cross-border surcharges would no longer apply.
Britons living in the EU “may lose the ability to access lending and deposit services, insurance contracts,” the document said. “The cost of card payments between the UK and EU will likely increase, and these cross-border payments will no longer be covered by the surcharging ban.”
The government said it was committed to giving regulators like the Bank of England and the Financial Conduct Authority a “general transitional tool” to phase in changes to ease the impact if no deal is agreed.
However, the EU would also need to take action to avoid disruption in cross-border financial services, it said.
“The UK is a major centre for investment banking in Europe,” the document said.