The UK’s banking landscape is changing in 2025 – and pensioners need to pay close attention.
With the Department for Work and Pensions (DWP) updating payment rules, certain banks may no longer be the safest choice for receiving your pension. Delays, frozen payments, higher charges, and poor customer service have put some banks under scrutiny.
In this guide, we break down the 5 banks pensioners should consider avoiding in 2025, why they might cause issues, and the best alternatives to keep your pension safe.
Why 2025 is a Turning Point for Pensioners and Banking
From April 2025, the DWP will implement stricter verification checks for pension payments. Banks that fail to meet the new real-time ID and fraud-prevention standards could experience payment delays.
Key changes include:
- Stricter ID Verification – even long-term customers may need extra checks.
- Faster Payment Compliance – banks must clear pension transfers within 24 hours.
- Fraud Monitoring Delays – some banks may hold payments for “security reviews.”
For pensioners living on a fixed income, even a 2–3 day delay can cause real hardship – especially during winter when energy bills are high.
The 5 Banks Pensioners Should Avoid in 2025
⚠ Disclaimer: This list is based on recent UK customer satisfaction surveys, complaints to the Financial Ombudsman, and public news reports. It is intended for informational purposes only.
1. Barclays
Why to be cautious in 2025:
- Reports of account freezes due to fraud checks, even for genuine transactions.
- Some pensioners complain of long waiting times for payment clearance.
- Higher branch closure rate, making in-person help harder to find.
Alternatives: Nationwide or Lloyds offer better face-to-face service for elderly customers.
2. HSBC UK
Why to be cautious in 2025:
- Customer service scores have dropped in the last 2 years.
- Complaints of “pending” pension payments during security reviews.
- Increased online-only processes that can be difficult for older customers.
Alternatives: Halifax has more straightforward pension payment processing.
3. NatWest
Why to be cautious in 2025:
- Known for strict anti-fraud algorithms that sometimes block legitimate pension transfers.
- Fewer rural branches, which impacts pensioners in smaller towns.
Alternatives: Santander offers better telephone banking support for over-70s.
4. Monzo Bank
Why to be cautious in 2025:
- Digital-only service with no physical branches.
- Some pensioners have struggled to provide ID verification online.
- Reports of delayed incoming payments during fraud checks.
Alternatives: Consider sticking with a traditional bank for pension deposits.
5. TSB Bank
Why to be cautious in 2025:
- History of technical outages causing payment delays.
- Complaints about slow dispute resolution for missing pension payments.
Alternatives: Lloyds or Nationwide for stability and better customer ratings.
Signs Your Bank Might Cause Payment Problems in 2025
Before switching, watch out for:
- Multiple unexplained delays in pension payments.
- Branch closures near you.
- Poor customer service ratings in independent reviews.
- Difficulty reaching a real human on the phone.
How to Switch to a Pension-Friendly Bank
Step 1: Compare banks using customer satisfaction surveys (Which?, MoneySavingExpert, Trustpilot).
Step 2: Choose one with proven fast payment records.
Step 3: Use the Current Account Switch Service (CASS) – transfers your account in 7 days.
Step 4: Notify the DWP of your new bank details at least 2 weeks before your next payment date.
Best Banks for Pensioners in 2025 (Based on Current Data)
- Nationwide Building Society – High customer service ratings.
- Lloyds Bank – Good for branch access.
- Halifax – Reliable pension payment processing.
- Santander – Strong telephone banking for older customers.
Frequently Asked Questions
Q: Will my pension stop if my bank has delays?
A: No, but payments can be held up by fraud checks or technical problems.
Q: Can the DWP recommend a bank?
A: No, but they advise choosing one with fast payment capabilities.
Q: What if I don’t switch?
A: You might still get your pension on time, but switching to a reliable bank lowers the risk of delays.