DWP Bank Account Checks: New Benefits Crackdown Lets Banks Share Account Details for Universal Credit, Pension Credit and ESA

From this week, your bank can be asked to hand details of your account to the Department for Work and Pensions (DWP) — not because you have done anything wrong, but because a major new fraud-checking power has come into force. It affects millions of households across England, Scotland and Wales, and it has left many claimants asking the same questions: what can the DWP actually see, and what should I do if my claim is checked?

What has changed — and when

According to the DWP's own guidance, published on October 13, banks and other financial institutions can now be required to share limited information about accounts into which certain benefits are paid. The power is called the Eligibility Verification Measure, created under the Public Authorities (Fraud, Error and Recovery) Act 2025.

The aim, according to the DWP, is to catch incorrect payments earlier — whether caused by fraud, a claimant's mistake, or an official error — The DWP sends banks an Eligibility Verification Notice setting out "eligibility indicators", warning signs based on the benefit rules, such as savings above the allowed limit. Banks check the accounts into which the relevant benefits are paid; if an account matches an indicator, they pass limited details to the DWP, which decides if a review is needed. No decision about your benefit is made on the bank data alone.

Which benefits are covered by the DWP bank checks?

The checks apply to three benefits only, according to the DWP guidance: Universal Credit, claimed by around 8.4 million people across 7m+ households, according to reporting on the new rules; Pension Credit, the top-up for pensioners on low incomes; and New Style Employment and Support Allowance (ESA), for people whose ability to work is limited by illness or disability.

The State Pension itself is not covered, according to the DWP's factsheet on the powers. That matters, because much of the confusion online has come from pensioners fearing their State Pension is being monitored. If you receive only the State Pension and no means-tested top-up, these bank checks do not apply to you.

What banks can share — and what they cannot

According to the DWP's guidance, when an account matches an eligibility indicator, banks may share only a narrow set of details: the names of all account holders; details of accounts held, including linked and joint accounts; account numbers and sort codes; how much money is in the relevant accounts; and the dates of transactions that took place in another country.

Banks cannot hand over full bank statements or transaction records, cannot tell the DWP how you spend your money, and cannot share sensitive personal information such as your political opinions or religious beliefs, or the specific locations of your transactions. The DWP says banks can be fined if they share information they are not permitted to disclose. Nor can the DWP log into your online banking or watch your account in real time — what it receives is a limited snapshot, triggered only when an account matches an indicator. For example, Universal Credit generally has a £16,000 savings limit.

What happens if your account is flagged?

If bank information suggests you may be receiving an incorrect payment, the DWP will review your claim. The review may find an error — or that all is well. According to the DWP, you will be contacted through your online journal if you have one; otherwise by phone, letter or text message. Respond promptly: delays could mean payments being held up. Any decision will always be made by DWP staff, not by an algorithm alone, and if you disagree you can ask for it to be looked at again through mandatory reconsideration.

The safeguards — and who watches the watchers

The DWP says strict limits govern how the data can be used: only to check entitlement, identify incorrect payments, and support enquiries into those payments. Irrelevant information must be destroyed. An independent reviewer will check that the DWP, banks and financial institutions have followed the law, with reports to Parliament.

What claimants should do now

The most important step is the simplest: keep your information up to date. The DWP is reminding claimants to report changes of circumstances promptly, That includes changes to your money, savings, investments or income; moving address; someone moving into or out of your home; receiving one-off payments such as gifts, refunds or compensation; and leaving England, Scotland or Wales for any period, including holidays. Failing to report a change could mean repaying an overpayment — and in some cases prosecution or a fine, according to the DWP. For anyone flagged, knowing what the DWP can and cannot see is the best protection.

Sources

• GOV.UK — How DWP checks benefit eligibility using the Eligibility Verification Measure (official DWP guidance)
• Messenger Newspapers — DWP bank checks for Universal Credit and Pension Credit explained
• The Sun — New benefits crackdown rule comes into force for over 7 million households across UK
• GOV.UK — DWP's Eligibility Verification powers: factsheet (Fraud, Error and Recovery Act)

Photo (file photo): Job Centre in Glasgow. Photo: Crowsus, via Wikimedia Commons (CC BY-SA 4.0).