Eligible SMEs with a business banking complaint have been reminded to register their complaint ahead of the Business Banking Resolution Service (BBRS) closing to new registrations at midnight on 13 December 2024.

Eligibility criteria can be found on the BBRS website, but in summary include:

• A business turnover of less than £10m at the time they complained to their bank and above the threshold of £6.5m (below this threshold would normally qualify them to use the services of the Financial Ombudsman Service).
• The issue must relate to a business banking complaint against one of the seven participating banks.
• The incident complained about must have taken place on or after 1 April 2019.
• The complaint must not have been through litigation or have been settled already.

SMEs who think they may have an unresolved eligible complaint against their bank should contact the BBRS to see if we can help.

The BBRS, which is wholly funded by its seven participating banks (Barclays Bank, Danske Bank, HSBC UK, Lloyds Banking Group, NatWest Group, Santander UK plc, Virgin Money), was originally intended to close in 2023 but was given a temporary extension to operate beyond this deadline.

Since its inception in 2021, the BBRS has left no stone unturned to encourage eligible SMEs to register their complaint with the BBRS. The BBRS has run multiple marketing campaigns creating 95 million Opportunities to See, engaged MPs and promoted its service through well-known business facing organisations.

Over £2m of financial redress has been made as a result of BBRS intervention. Many cases have had non-monetary resolutions such as changes in loan terms, adjustments to debt recovery arrangements or interest rates, and adjustments to or cancellations of personal guarantees.

Despite these efforts, the BBRS has seen much lower case numbers than originally forecast at its inception. Independent research from Bayes Business School, commissioned by the BBRS in 2021 to investigate the low caseload, concluded that there were only 1,600 possible cases in scope for the BBRS.

Further independent research commissioned by the BBRS and conducted through Public First, who spoke to 522 senior SME decision makers within the BBRS’ remit, found 86% were satisfied or very satisfied with their banks.

The evidence, data and current case volume suggest the customer base anticipated for the BBRS is not there and that the demand is insufficient for the BBRS to operate on a permanent basis.

The decision to close the contemporary scheme follows a report by the Financial Conduct Authority (FCA). The FCA’s report did not recommend expanding the remit of the Financial Ombudsman Service (FOS) for Business, which currently accepts business banking complaints for SMEs with a turnover up to £6.5million. In their report from October 2023 the FCA wrote:

The low numbers of complaints referred under the [BBRS’] contemporary scheme suggest to us that there is not a strong demand from larger SMEs for access to ADR [Alternative Dispute Resolution]. The BBRS has carried out large-scale advertising campaigns to encourage case registrations, so the lack of demand is unlikely to be due to a lack of awareness of the service.

Mark Grimshaw, CEO of the BBRS said: “The BBRS was put in place to provide a business banking resolution option for a small number of SMEs that are currently outside the remit of the FOS. Within that small market, we have been able to achieve valuable outcomes for SMEs, both monetary and non-monetary, which simply wouldn’t have happened without the existence of the BBRS.

“The BBRS has left no stone unturned to encourage as many eligible SMEs to come forward to use our services but despite those efforts, we have only seen a fraction of the cases that were predicted. Our research, insights and case data shows that the market for the BBRS, within the eligibility criteria it was given at its inception, simply doesn’t exist and we acknowledge the decision of the funding banks to close our contemporary scheme.

“We would like to encourage all eligible SMEs to come forward ahead of 13 December 2024 to register their business banking complaint with us.”

Ends.

Notes to editors

• The BBRS was formed as a resolution service for a small and clearly defined section of the SME banking market. Since the expansion of the Financial Ombudsman Service for Business in April 2019, estimates suggest that this support covers 99% of the SME market. The BBRS was set up to cover a small layer of businesses just outside of the FOS upper limit on turnover size of £6.5m.
• The eligibility criteria for the BBRS were agreed unanimously before it launched by the Implementation Steering Group (ISG), which comprised of the banks and the SME representatives (including the Federation of Small Businesses, SME Alliance, British Chambers of Commerce, APPG on Fair Business Banking, Institute of Directors and Confederation of British Industry). The process was supported by independent legal advice and overseen by UK Finance/HM Treasury and the FCA (including the FCA’s SME Advisory Group chair).
• The key eligibility criteria agreed by the ISG for the BBRS include:
  • A business turnover of less than £10m at the time they complained to their bank and above the threshold of £6.5m (below this threshold would normally qualify them to use the services of the Financial Ombudsman Service).
  • The issue must relate to a business banking complaint against one of the seven participating banks.
  • The incident complained about must have taken place on or after 1 April 2019.
  • The complaint must not have been through litigation or have been settled already.
• The BBRS is not an appeals body and cannot consider cases which have already been to some other schemes, the FOS or the courts. The BBRS does not have the statutory powers required to overrule these bodies.
• The BBRS was set up for an initial period of three years to resolve eligible complaints through its historical and contemporary schemes. It has continued to receive new complaints into 2024, although still at very low levels, and the banks have therefore now decided to close the contemporary scheme to new registrations. This follows the completion of an FCA Review of Financial Ombudsman Service thresholds and a recent Treasury Select Committee Inquiry into SME Finance which concluded that the BBRS should close as originally planned. The BBRS will continue to receive case registrations until midnight on 13 December 2024 and will ensure that all cases which are registered with us before this date are processed as normal.
• Our customer satisfaction data shows that our customers believe we are doing a good job:
  • 70% of customers surveyed do not believe they would have received a resolution if they hadn’t come to the BBRS.
  • 85% of customers agreed or strongly agreed the application was simple to complete, based on data from those who raised their complaint after the BBRS’ launch. This indicates that as processes have improved, so has satisfaction with the application process.
  • 82% of customers felt that they had received a great deal of help from their Customer Champion (case registration support officer) in setting out their complaint.