The Department for Work and Pensions (DWP) has confirmed that its test-and-learn phase for new bank account eligibility checks will begin this year, with a full rollout expected by 2029/2030.
Under new anti-fraud laws, bank account providers will be ordered to review their records for accounts linked to certain benefits. They will flag any accounts that may not be entitled to receive DWP payments for further investigation.
Three benefits in scope
The DWP said it is working closely with industry partners to ensure the checks are carried out "safely and effectively". Initially, the accounts of people on these benefits will be checked for anomalies:
- Universal Credit
- Employment and Support Allowance
- Pension Credit
The legislation, which became law in December 2025, allows for the checks to be expanded to other benefits in the future.
Expert backs accuracy focus
Phil Cotter, CEO of compliance services group SmartSearch, said the checks could help prevent wrongful payments. He said: "The DWP's planned test-and-learn phase is an opportunity to establish how bank account checks can reduce fraud and error without wrongly penalising people who are entitled to support. Used effectively, these checks could help identify discrepancies in claimants' eligibility earlier, prevent incorrect payments and reduce the cost of recovering overpayments later."
He added that the priority for the test phase "must be accuracy", to ensure the checks "identify genuine fraud and administrative errors while ensuring that public money reaches those who are entitled to it".
Cross-checking with HMRC records
Mr Cotter suggested the DWP could cross-reference the information with other "reliable data sources", such as "HMRC records" and "verified identity information", to help investigators get an accurate picture of a person's situation.
He also stressed the importance of evaluating the findings from the test phase. He said: "It is important that any expansion is based on evidence from this initial rollout, rather than simply extending the powers across the benefits system as quickly as possible. The DWP needs to be able to demonstrate that the checks are accurate, proportionate and subject to effective oversight. This will help ensure that any future expansion reduces fraud and error without undermining confidence among people who rely on benefits."
The DWP has previously said that no-one's benefits will be stopped purely on the basis of their bank account being flagged by these checks. The legislation also includes powers for investigators to directly take cash from a person's bank account if they owe the DWP funds and are refusing to pay, intended for people who have left the benefits system. Previously, the DWP could only claw back owed funds through deductions from benefits awards or PAYE earnings.
