LONDON (Reuters) – British finance minister Philip Hammond called on banks to strengthen a proposed redress scheme for small businesses, which lawmakers and victims argue is too soft on lenders.
A dispute service proposed by UK Finance, which represents banks, must include a broad range of interests and not impose a compensation cap, Hammond said in a letter released on Tuesday.
Scheme - Response - Decade - Campaigning - Firms
The voluntary scheme was proposed in response to a decade of campaigning by small firms who say they were mistreated by their banks in the wake of the 2008 financial crisis.
It is aimed at companies with a turnover of between 6.5 million and 10 million pounds which is above the eligibility threshold for taking complaints to Britain’s free Financial Services Ombudsman, leaving them facing a costly court case if they want to pursue a lender.
Binding - Commitment - Banks - Compensation - Pounds
It includes a binding commitment on banks to pay compensation up to 350,000 pounds for “historic” complaints that date back to the financial crisis a decade ago, although the scheme could recommend a higher amount.
UK Finance, which declined...
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