Banks race to finalise funding for new disputes scheme | Business News

Britain’s biggest banks are racing to finalise the funding and rules of a new dispute resolution scheme designed to end years of controversy over small businesses’ treatment at the hands of their lenders.

has learnt that seven major banks have yet to formally sign off on the details of the Business Banking Resolution Service (BBRS) despite a pledge made two months ago that it would launch in the autumn.

Sources said on Wednesday that the industry, which is funding the new complaints-handling service itself, was now hoping for it to be fully operational early in the new year at the latest,

The BBRS, which has been endorsed by the government, was conceived in response to a review led by the former Institute of Directors direct general, Simon Walker.

It came after a deluge of complaints about the way that banks including Royal Bank of Scotland Group (now NatWest Group), Lloyds Banking Group and Clydesdale dealt with complaints from SME customers in the years after the 2008 financial crisis.

Natwest bank
Natwest is the new name for the former RBS Group

Alongside those lenders, Barclays, Danske Bank, HSBC UK, and Santander UK have agreed to participate in the BBRS.

One bank executive suggested that Santander UK had balked at the estimated £10m cost to each institution of establishing the new service, but this was dismissed by the Spanish-owned bank.

“We have confirmed our commitment to the successful launch of the BBRS and we continue to work with the BBRS leadership and our counterparts across the banking sector to finalise outstanding matters and to ensure the scheme will be effective, sustainable and operationally ready at launch,” a Santander UK spokesman said.

In September, the BBRS, which has been conducting a pilot exercise with approximately 40 complainants since last year, said it would launch in the autumn.

A BBRS spokesman added: “The BBRS is on track to launch very soon with seven participating banks including Santander.

“The organisation’s overall operating budget has been agreed in principle by all seven funding banks.”

Sky News