Concern has been raised about so-called ‘interest-rate swaps’ which were sold as protection for interest-rate rises on loan repayments.
However, many companies are finding they have been hit with higher repayments as this product requires customers to pay additional fees to the bank when rates fall. One licensee revealed that he would have to pay £173,000 to get out of his interest-rate swap.
Michelle Neary, business development manager at Legal Plus, which specialises in financial products, said: “First, check if there are two payments coming out of the account — one for the loan and another for the swap.”
The Financial Ombudsman Service (FOS) said that licensees can file a complaint directly to their bank and then to the FOS, or use an intermediary company to complain on their behalf.
“Businesses should make a complaint to their bank in the first instance and allow eight weeks for a response,” said an FOS spokeswoman. “After this, if they have not received a response or are not happy with it, they should come to us and fill in a complaint form.
“If they use a third party, the case will be dealt with in the same way as if they came to us directly.”
