Competition watchdog stops Lloyds’ unfair treatment towards firms hit by COVID-19
LONDON (UK) – Britain’s competition watchdog has prevented Lloyds Banking Group from imposing pressure on small business customers affected by the COVID-19 pandemic for opening business current accounts so that the emergency state-backed funding could be accessed upon.
The Competition and Markets Authority said asking struggling companies to open a business account in order to get a so-called ‘Bounce Back’ loan was unfair on the part of Lloyds.
It came to CMA’s knowledge that 30,000 customers running their business were found to be using their personal account.
CMA’s Adam Land said, “By forcing businesses to open current accounts as a pre-condition to access this scheme, Lloyds breached the CMA undertakings it signed, reduced choice and put their customers at risk of being unnecessarily charged.”
A Lloyds spokesman said the bank had asked customers to open a business account to make sure there is a quick access to funding.
“We proactively informed the CMA of our approach and are now writing to our customers to reiterate that they can transfer their account to a free loan servicing account at any time, should they wish to do so,” the spokesman added.