What to do if your bank closes your business account

Discovering that your business bank account has been closed — a process often referred to as debanking — can be stressful and disruptive. But it’s important to act quickly to keep your finances on track, protect cash flow and ensure your business continues running smoothly. 

This guide outlines what to do if your bank closes your account and how to safeguard your business against sudden banking interruption.

At a glance

• A bank should give you at least two months’ notice before closing a business account. This is rising to 90 days from April 2026

• Common reasons for closure include inactivity, suspicious or criminal activity, regulatory issues or a breach of the terms and conditions 

• If your bank closes your business account, you can complain first to the bank and then to the Financial Ombudsman Service

• If your bank won’t reopen your account, ask to have the funds transferred to another account

Can a bank close my business account without warning?

A bank can close your business account at any time and without explanation, although it should still give you notice beforehand.

Under current rules, your bank should give you at least two months’ notice before closing a business bank account or terminating a payment service. However, from April 2026, this notice period will increase to 90 days for new contracts, giving customers more time to challenge decisions or find a new account. Banks must also provide a clear explanation for the closure. 

Bear in mind that some business bank accounts aren’t covered by regulation, and if a bank suspects money laundering or other legal activities, it may close your account without warning. 

Why would a bank close my business account? 

There are several reasons why a bank might close your business account. Common ones include: 

Inactivity

If you haven’t used your business account for a while, your bank may decide to close it to reduce administrative costs or comply with regulatory requirements around dormant accounts. 

Suspicious activity and financial crime

Banks have a legal obligation to ensure their services aren’t being used for financial crimes such as money laundering or financing terrorism. If your bank spots repeated large deposits or withdrawals that don’t match your usual business activity, or transfers to or from high-risk countries, it may close or freeze your account.  

Regulatory or compliance issues

If you fail to send updated identity documents, proof of address or other information about your business, your bank won’t be able to follow strict Know Your Customer (KYC) rules and may be forced to close your account. 

Your bank may request these documents from time to time as financial guidelines change, so be sure to supply them quickly. 

Breach of terms and conditions 

If you use a business account for personal transactions or frequently exceed your overdraft limit or fail to pay bank fees, your bank may decide enough is enough and close your account. 

What should I do if my bank closes my business account? 

If your bank closes your business account, there are steps you can take to try to resolve the issue:

1. Contact your bank

As a first step, speak to your bank to try to find out why your account has been closed. If you think your bank closed your account unfairly or failed to give you adequate notice, ask whether it can reopen your account. 

If it refuses, ask how you can get your money back. You may need to provide the details of another company account or your personal account so the bank can transfer your money. 

2. Make a formal complaint

If you are not happy with the outcome, you can make a formal complaint to your bank. It must respond within 15 days if your complaint relates to payment issues linked to the closure of your account or not being given enough notice, or within eight weeks for other types of complaint. 

3. Take your complaint to the ombudsman 

If, after receiving your bank’s final response, you are still not satisfied with the outcome, you can complain to the Financial Ombudsman Service (FOS). This is an impartial and free dispute resolution service for consumers. 

Some of the types of complaints it sees that relate to account closures include factual and administrative mistakes, being given conflicting information, and not receiving enough notice.  

Just be aware this can be a lengthy process and you may not get the outcome you want. In such an instance, you will need to look for a business bank account elsewhere. However, it’s unlikely you’ll be able to do this if your bank closed the account due to fraudulent or criminal activity.

On the other hand, if the FOS rules in your favour, you may receive compensation from your bank and it may have to reopen your account.

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