FCA publishes findings of SME collections and recoveries review

The FCA has set out the findings of its review on how retail banks treat SME customers who are in collections and recoveries.

The FCA reviewed 11 retail banks which provide SME lending services, including BBLS, and found repeated instances of poor customer outcomes and failure to treat customers fairly. The review identified several themes which are driving poor customer outcomes, including:

• gaps in policies and procedures;
• staff training that did not adequately cover conduct requirements;
• manual interventions within systems which appeared to make delivering fair customer outcomes more difficult;
• absence of outcomes testing that considered whether customers had received fair outcomes from the end-to-end treatment they received;
• poor record keeping – some banks could not provide complete customer files and it was not possible to determine if the customer had received a fair outcome based on the records;
• instances of customers providing information indicating characteristics of vulnerability that were not considered or suitably responded to.

The FCA has provided written feedback to the banks involved in the review but it has also written to the chairs of all retail banks with SME customers as it wants to see improvements across the whole sector.