More than five million people with basic bank accounts are unable to 'pay at the pump' when buying fuel at many petrol stations because of a block put on their debit card by their bank, can reveal.

Lloyds, Halifax and Bank of Scotland – which between them provide almost half of the UK's eight million basic bank accounts – have become the latest banks to prevent customers paying on their card at many unmanned self-service pumps.

Basic bank accounts, mainly aimed at those with poor credit scores, don't have overdrafts. Many banks are blocking account holders from paying at the pump if the pump is unable to check whether customers have enough money to buy fuel before they start to fill up, while Santander has barred basic bank account customers from paying at ANY self-service pump.

For more info on this kind of bank account see our Basic Bank Accounts guide, and for help cutting what you spend on fuel see our Cheap Petrol & Diesel guide.

Why are banks blocking 'pay at the pump' transactions?

In October 2016, Visa introduced rules for pay at the pump terminals, stating that customers' cards should be authorised before they're allowed to buy fuel, by putting a temporary hold for £100 on their account until they've paid. The idea behind this was to ensure customers always have sufficient funds to pay.

However, more than a year later many petrol stations – including all Tesco and Asda forecourts with self-service pumps – still haven't upgraded their systems to follow the Visa guidance.

As a result, to stop customers who don't have an overdraft spending money they don't have, a number of major banks have blocked customers using their cards at pumps that haven't been updated.

In some cases, banks have done this since the Visa rules were brought in. But MoneySavingExpert can reveal that in December Lloyds Banking Group, which is responsible for Lloyds, Halifax and Bank of Scotland and offers almost four million basic bank accounts, also decided to do this.

'I usually have to get fuel early – my card kept getting rejected'

The block on cards from Lloyds was first pointed out to us by MoneySaver Andy Trueman, an assistant transport manager from Derby. He told us: "I used to regularly pay at the pump for my fuel, but for the last month my debit card kept getting rejected. I rang my bank – Lloyds – and apparently this is because too many people were going overdrawn using this facility.

"I usually have to get fuel early in the morning because of my work pattern. Now I make sure I get my fuel when my shift allows me to go when the forecourt shop is open... I encountered the problem at both Morrisons and Asda fuel forecourts."

We've also seen people discuss the issue in our forum. Forumite Djene posted earlier this week to say that their Santander debit card wasn't accepted at a Morrisons fuel pump, and that they were told by the attendant that their card must have less than the required amount on.

Djene added: "But there is over that amount [on the card]. It takes my Nationwide debit card fine. All the cards work perfectly fine in Morrisons [in the store]."

Which banks implement the block?

We've contacted all the big banks to ask them what their policies are on this – here's what they told us:

Are basic bank account holders blocked from paying at the pump?

Bank Block?
Bank of Scotland Yes – at non-updated pumps
Barclays No
Co-op No
Halifax Yes – at non-updated pumps
HSBC Yes – at non-updated pumps
Lloyds Yes – at non-updated pumps
Nationwide No
NatWest Yes – at non-updated pumps
RBS Yes – at non-updated pumps
Santander Yes – at ALL pumps, including updated ones

How many pumps haven't been updated?

No one seems to know for sure – but it's likely to be a large number.

The Petrol Retailers' Association told us it doesn't have any figures for the proportion of petrol stations which have had their systems updated – and of course, a large number of the UK's 8,500-odd petrol stations don't have any pay at the pump facilities.

But Tesco – which has about 500 petrol stations, many with pay at the pump and some which are ONLY pay at the pump – told us it hasn't updated its systems. Neither has Asda, which has around 300 petrol stations in total.

We've heard reports that motorists have had problems at Morrisons too, though it, as well as Sainsbury's, Esso or BP, has not responded to our queries on this. Shell told us it doesn't have any self-service pumps at its petrol stations.

What can I do if my card's blocked?

The easiest way to avoid the problem is to go to a manned till, for example in a forecourt shop, to pay for your fuel. Blocks aren't implemented on these tills.

However, if you really do need to use a self-service pump, you could consider getting a basic bank account with a bank that lets you pay at the pump. Be careful though, as the blocks are primarily designed to stop you paying for fuel you can't afford. See Basic Bank Accounts for more info and our top picks.

If paying at a self-service pump is essential, you could also consider a credit card. See our Credit cards for bad credit guide for more info.

When will the problem be fixed?

At the moment, it's unclear. The Petrol Retailers' Association wasn't able to give us a firm timescale for when all stations will have upgraded their systems.

Asda told us that it has the software ready to go but is waiting to implement it, while Tesco said it is working with Visa about this issue at the moment.

What do the banks say?

A Lloyds Banking Group spokesperson told us: "Basic bank accounts do not offer an overdraft. As the majority of 'pay at pump' terminals do not check that a customer has sufficient funds, we prevent customers from going accidentally overdrawn by not allowing the use of basic debit cards.

"This will change when fuel retailers implement the Visa regulations which came into effect in October 2016. However, all customers can continue to pay by debit card at petrol stations with a manned counter."

HSBC told us: "HSBC basic bank account holders can use their debit card at pay at pump machines where the transaction can be authorised online. This ensures a customer does not go overdrawn, which is an important element of the account."

Santander told us it blocks pay at pump transactions on its basic debit card "regardless of the type of pump/retailer".Nationwide told us it is "monitoring" the situation, but does not block anyone from paying at the pump at present.