The Treasury select committee has pressed the FCA and RBS for more detail on the redress scheme for small business customers that were mistreated by RBS so it can be confident they will get “reasonable compensation”.
RBS announced in November it would introduce a new complaints process and refund fees to business customers in its former Global Restructuring Group in a programme that is expected to cost the bank £400m.
However, in a letter to RBS chief executive Ross McEwan, committee chair Andrew Tyrie questioned the bank as to whether the £400m was an underestimation.
The £400m covers operational costs, the refund of complex fees and redress costs from the new complaints process. The automatic refund of fees applies to small and medium-sized enterprises that were customers of GRG between 2008 and 2013.
In a separate letter to FCA chief executive Andrew Bailey, Tyrie asks a series of questions about the redress scheme including around transparency, how it will handle businesses that have gone into liquidation, and why firms do not have access to an independent reviewer.
Tyrie says: “More detail on the design of the scheme is needed. This could give affected businesses more confidence that they will obtain reasonable compensation. The regulator should publish its full report into GRG as soon as possible.”