Thousands of small businesses will be told that they may have been mis-sold interest rate caps by their lenders, potentially putting the country’s largest banks on the hook for at least £1 billion in new compensation payouts.
The surprise move by the City watchdog could come as early as today.
The Financial Conduct Authority is expected to say that between 5,500 and 6,000 businesses will be allowed to join its redress scheme for swap mis-selling, having been overcharged tens or even hundreds of thousands of pounds on ceilings to protect them against interest rate rises.
Royal Bank of Scotland could be hit hardest by the move, as industry insiders say that it sold more than third of the caps that could now be reviewed.
HSBC