Come in number nine, you're a credit risk

Are you a safe-bet "number one" or a risky "number nine"? Lloyds TSB has categorised every one of its 15 million customers into nine bands - and the number flashes up on screens behind the counter without the customer's knowledge when they carry out a transaction in the bank's branches.

Staff in the bank can see a score running from one to nine which helps them judge the credit-worthiness of the customer they are dealing with. The better the score, the better the access to low-interest rate loans and overdrafts.

The bank's rating system - where a number one is a high earner with a perfect payment record and a lowly number nine persistently bounces cheques or exceeds overdraft limits - does not appear on bank statements or in any communications to customers.

The vast majority of customers are completely unaware of their score, called the "risk band".

In tests this week, bank staff were reluctant to give out a customer's score - but if pressed (and faced with the clout of the Data Protection Act) will generally do so.

At one Lloyds TSB branch, when we asked for the risk band number, we were told: "You're not supposed to know that." Pressed again, the clerk revealed that the person in question was a "number two".

Is that good or bad, we asked? "That's very good. I'm a number six and I work here."

Lloyds TSB is not the only bank to operate a customer grading system. HSBC is understood to assign every account holder a behavioural score of one to 100, where 100 is the best possible customer. It also gives customers a "star" rating of between one and five stars, to guide staff both on the past record of customers and their "potential" for various products and services the bank sells.

A Lloyds TSB spokesman said: "We do have a customer segmentation system, called risk banding. It's for internal use only.

"It is drawn from a range of information we hold on the customer. It is not an external credit rating, and it does assist us in our decision making. It is entirely impartial."