After years fighting for justice for SMEs, the APPG on Fair Business Banking has been instrumental in creating the Business Banking Resolution Service (BBRS). We spent two years around the table working intensely with the numerous stakeholder groups in order to set up a system that is robust and independent. However, from the start the APPG has had concerns about the scope of the service. You can read our original position statement here.
Our core focus has always been in line with the overarching principles set out by the then Chancellor, Phillip Hammond, on hearing a “meaningful” number of historic cases, ensuring each case is considered properly and carefully, and that banks default position will be to pay the amount recommended by the BBRS. His letter to UK Finance can be viewed here.
By remaining an active part of the process, the APPG, alongside the other SME representatives, has successfully widened the scope of the BBRS, including:
- Awards limit of £350k for the historic scheme and £600k for the forward-looking scheme being moved to a default position whereby the full amount of any claim should be paid without limit
- The event date of mistreatment being moved from 2008 back to 2001
- Businesses that can demonstrate that material evidence was not considered properly in an ‘independent scheme’ will qualify for a ‘boundary cases’ approach, where the BBRS will assist the complainant to secure a fair and reasonable outcome with the bank
- Agreement for payment of split determinations so that claimants can receive payments for direct losses whilst consequential losses are being considered
- Ensured that former directors and shareholders of dissolved entities are eligible to bring complaints so that the dissolved entity can be considered.
- Ensured the ‘cliff edge’ dates were brought forward to ensure there are not gaps in the service
As members of the ISG, the APPG has signed off on the legal architecture for the BBRS and is content that the service we have helped build has the ability to determine fair and reasonable outcomes for small businesses which fall in its scope. This sign off is, however, conditional, as concerns remain about the commitment of the banks to resolve historic complaints. Good faith has been enshrined in the agreements between the banks and the BBRS, and we will be taking part in a post-implementation review of the service.
It is important to note that one of the key principles upon which the BBRS was founded was to restore trust between banks and businesses. This is more important now than ever. It will therefore be critical that the spirit of this mission is embraced both by the BBRS and, critically, by the banks when they are dealing with historic cases that have been through previous so-called independent reviews.
We are encouraging all those with cases to dispute against business banking – whether eligible for the service or whether a boundary case – to sign up to the BBRS. The BBRS has been designed to be a learning organisation and has been given a mandate to assist boundary cases, and this will only be tested if we have sufficient numbers of complaints going through the service.
We will reserve final judgement on the efficacy of the BBRS until the review is concluded.