This happened to me 2 years ago, HSBC told me at the time it wasn't down to them something to do with PayPal, PayPal told me that it wouldn't accept the type of account...how can It not accept a 'HSBC Currrent Account'?
I ended up opening another Current Account at the SAME bank...and the funny thing is that it worked, very strange,
This was 2 years agi so im sure they have solutions for it now... let us know how it goes