FCA fines Barclays £26m over treatment of customers in financial difficulty

The Financial Conduct Authority (FCA) has fined Barclays Bank UK PLC, Barclays Bank PLC and Clydesdale Financial Services Limited (Barclays) £26m for failures in relation to their treatment of consumer credit customers who fell into arrears or experienced financial difficulties.

Between April 2014 and December 2018 some retail and small business customers who had been offered consumer credit were treated poorly when they fell into arrears. The FCA found that Barclays failed to treat customers fairly or to act with due skill, care and diligence.

Specifically, Barclays failed to:
- follow its customers’ contact policies for customers who fell into arrears,
- failed to have appropriate conversations with customers to help understand the reasons for the arrears and,
- failed to properly understand customers’ circumstances leading it to offer unaffordable, or unsustainable, forbearance solutions.

Barclays has pro-actively redressed these customers, paying over £273m to at least 1,530,000 customer accounts since 2017. The redress programme is close to completion.

Mark Steward, executive director of enforcement and market oversight, said: “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.

“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.”

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