Obtaining a bank reference

What is a bank reference?

A bank reference is a letter or document issued by a bank confirming that an account holder has an account with it, and giving its opinion on the account holder’s ability to meet a financial commitment.

A bank reference will only be provided by the bank with the explicit authorisation of the account holder to comply with strict data protection laws. The bank will generally require written authorisation for each and every separate enquiry.

Specific account details are not generally given by the bank. Commonly, the requesting third party, such as the landlord or letting agency, requests a bank reference from the account holder who will submit their figures showing the intended financial exposure. The bank will then provide some basic information and its measured opinion on the capability of the customer to take on the proposed financial requirements.

Since the bank has to protect the account holder, the information is relatively general.

How is a bank reference obtained?

Either the third party, such as a letting agency, formally requests a bank reference from the bank with the account holder’s written permission; or the account holder themselves request it.

Normally, it will be requested by the third party, using the bank/building society standard documentation including a consent form. The third party is likely to complete the form, send it to the account holder to complete the consent form, and they will then forward it to the bank.

Who is authorised to request a reference?

Generally, only the account holder is authorised to request a bank reference, but the account holder can typically allow third parties to make enquiries along with a letter of authorisation. This must, of course, be in line with the specific policies individual banks will have in place.

What are bank references used for?

Bank references are generally required by third parties who are about to engage in some degree of financial risk with the account holder.

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For more information on:

  • Example: bank reference request procedure for landlords
  • What are the contents of a bank reference?