Question to the HM Treasury:

To ask the Chancellor of the Exchequer, if he will take steps to help improve the ability of high street bank customers to (a) challenge and (b) scrutinise past decisions made by financial institutions which have caused hardship and distress, including the repossession of a property.

In most circumstances, the provision of a bank’s services is a commercial decision for the bank and the Government does not intervene in these decisions. The terms and conditions of the contract between the two parties govern that contract, and although the Treasury sets the legal framework for the regulation of financial services it does not have investigative or prosecuting powers of its own.

Disputes arising between a bank and its customers is usually best resolved by the parties involved. The Financial Conduct Authority (FCA) rules require the banks to properly investigate all complaints and, through ongoing supervision, it continues to monitor the banks’ complaint handling processes. If customers are unable to resolve the issue with their bank, they will be eligible for further review by the Financial Ombudsman Service (FOS). The FOS provides a free, independent dispute resolution service for bank customers.

The Government has also taken action aimed at helping people avoid repossession, including Support for Mortgage Interest (SMI) loans to homeowners on a low income and protection in the courts through the Pre-Action Protocol which makes it clear that repossession must always be the last resort for lenders. As lenders should only take steps to enforce a repossession order as a last resort, it is vital that homeowners who are having trouble paying their mortgage, or are worried about meeting payments in future, make early contact with their lender.

Homeowners who are worried about their mortgage payments may also want to get in touch with Money Helper which has been set up by Government to support consumers with comprehensive, consistent, guidance for every stage of their financial lives. It offers free and impartial information on money matters, available to all online at: www.moneyhelper.org.uk, or by calling the Money Helper helpline on 0800 138 7777.