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PPI: Treasury want help as Santander accuse customers

Treasury Minister Greg Clark has called for help for SMEs. Picture: Contributed

Treasury Minister Greg Clark has called for help for SMEs. Picture: Contributed

  • by MARTIN FLANAGAN
 

THE stark split in attitude to recent banking scandals was highlighted yesterday when Santander joined Lloyds in ­suggesting that some customers made false claims over mis-selling in a quest for compensation.

It came amid weekend reports that a senior government minister has urged Britain’s “Big Five” banks to let far more small businesses (SMEs) who were mis-sold interest-rate hedging products to suspend the premiums they pay.

Treasury Minister Greg Clark is said to have privately told City watchdog the Financial Services Authority that its recent finding that more than 90 per cent of interest-rate hedging products were mis-sold was a “game-changer”.

One Treasury source reportedly said banks would be “crazy” to insist customers continue paying for a discredited product.

Clark is understood to have stopped short of calling for a moratorium on payments, but rather a loosening of the banks’ approach to help more SMEs.

Barclays, HSBC, Lloyds and Royal Bank of Scotland have agreed to suspend payments on a “case by case basis” where SMEs can prove they have suffered financial distress.

However, Juan Rodriguez, deputy chairman of Santander UK, was reported as saying: “The UK is a complicated market because people often complain they did not understand something and it’s not always true.

“When you invest in a product you should know you can lose money.”

His comments came after Eric Daniels, former head of Lloyds, told MPs last week that many PPI claims were not legitimate.

 

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