Lenders slammed for interest rate swaps compensation delays
The high street’s biggest lenders have been publically criticised by Business Secretary, Vince Cable for failing to pay compensation to small and medium businesses mis sold an interest rate swap.
The frustration comes after it was revealed that only a handful of businesses have received compensation for interest rate swaps mis selling despite banks first being ordered to undertake a full review of these product sales almost a year ago.
Insiders have also revealed for those who have received compensation the payout has been ‘very, very small’.
Mr Cable is now trying to secure a meeting with the Financial Conduct Authority’s Chief Executive, Martin Wheatley, to find out if banks are under any kind of pressure to right this wrong.
The risk of dragging feet
For some businesses with an interest rate swap time really is of the essence; the Limitation Act 1980 means any claim not bought within six years of the interest rate swap start date will be unable to pursue court action.
This means a business could find their claim time barred due to a lender’s deliberate lack of urgency.
The need for speed
Lenders may have been instructed to review their sales of interest rate swaps but the last year has demonstrated this does not guarantee fair and adequate, or in many cases any, amount of redress.
Affected businesses are urged to seek professional legal representation to ensure their case is given the attention it deserves and not rely on lender’s good intentions.
Content correct at time of publication