Correspondence
CMA letter to Lloyds on a breach of the SME Banking Undertakings
Letter to Lloyds Banking Group for non-compliance with the Small and Medium sized Enterprises (SME) Banking Undertakings 2002.
Documents
Details
Lloyds Banking Group (Lloyds) breached the Small and Medium-sized Enterprises Banking Undertakings. Lloyds required SME customers holding a PCA to open a Business Current Account (BCA) in order to progress their application for a loan under the Bounce Back Loan Scheme (the Scheme). Lloyds gave undertakings in 2002 to not bundle BCAs in this way. Lloyds started offering the loans under the Scheme on 8 May 2020.
Lloyds has committed to address its breach of the undertakings by:
- implementing and updating processes by middle of September 2020
- advising its customers applying for a loan under the Bounce Back Loan Scheme (BBLS) that they are not required to open or maintain a BCA in order to apply for a Bounce Back Loan and offering customers the choice upfront to apply for a fee-free Loan Servicing account or a BCA
- writing to existing BBLS customers with a BCA to offer the chance to switch to a fee-free loan servicing account
- providing 2 months’ notice to customers holding BCA of account charges being imposed
The action plan on this page sets out information on Lloyds’ actions to address the breach.
Updates to this page
Published 8 September 2020