Barclays PLC hit with fine over poor treatment of customers in difficulty

() has been fined £37mln by the UK financial watchdog for failing to properly look after personal banking and small business customers experiencing financial difficulties.

The Financial Conduct Authority said that as high street bank has already paid over £273mln in redress to at least 1,530,000 customer accounts over the past four years and agreed to settle the case, it has qualified for a 30% discount and so will only be fined £26mln.

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Over more than a four year period to the end of 2018, the regulator found that many Barclays retail and small business customers who had been offered consumer credit were “treated poorly” when they fell into arrears and that Barclays “failed to treat customers fairly or to act with due skill, care and diligence”.

This included failing to have appropriate conversations with customers to help understand the reasons for the arrears and not making the effort to properly understand customers’ circumstances, which led to the bank offering “unaffordable or unsustainable” forbearance solutions.

“Consumers should feel reassured that their lender will work with them to help resolve any financial difficulties, whereas Barclays’s poor treatment of its customers risked making these difficulties worse,” said the FCA’s executive director of enforcement and market oversight, Mark Steward.

“Firms must treat consumer credit customers fairly, including when they find themselves in arrears.

“We will take action against unfair treatment, or where firm systems expose customers to the risk of unfairness. While this case predates the pandemic, this message is especially important as the impact of coronavirus continues to affect household incomes and budgets.”