Monday, 22 January 2018

More small businesses get access to Financial Ombudsman Service

The City regulator wants to widen access to the Financial Ombudsman Service, enabling more firms to act if they feel badly treated by banks.

An additional 160,000 small firms would be able to use the service, the Financial Conduct Authority (FCA) says in a consultation document.

Currently, only individuals or firm with fewer than 10 staff can use the Ombudsman to settle financial disputes.

Under the FCA proposals, firms with up to 50 staff could use the service.

Larger businesses will still have to use the courts to settle disputes.
Launching a consultation into the idea, the FCA said there needed to be an effective dispute resolution mechanism for businesses.

"Our evidence suggests some small businesses currently find it hard to achieve a fair outcome in disputes with financial services firms, because court action is not a realistic option for them," said Andrew Bailey, the FCA's chief executive.

"We have considered what could be done within our powers and the remit of the Financial Ombudsman Service to improve this situation and are proposing to expand access to the Ombudsman."

The news was welcomed by some small businesses.

However, MPs on the All Party Parliamentary Group (APPG) on Fair Business Banking said many firms would still not get access to justice.

They suggested a tribunal system to deal with disputes instead.

BBC       News.