One of the least understood facts about business borrowing in the UK is also one of the most important: if a company falls into dispute with its lender, it usually cannot turn to the Financial Ombudsman Service. That route is largely reserved for individuals and the smallest businesses meeting specific tests. The Business Banking Resolution Service, or BBRS, was set up to address part of that gap — but its story is a cautionary one. This is commentary on where business dispute resolution stands, and why we would rather you knew the limits than discovered them later.
Why business borrowers fall outside FOS
The Financial Ombudsman Service exists to resolve complaints between financial firms and their customers without going to court. Its reach, however, is built around consumers and micro-enterprises that satisfy particular eligibility criteria. Many businesses — and the kind of unregulated, company-to-company lending we provide — fall outside its remit entirely.
This is a direct consequence of how the regulatory perimeter is drawn. Our lending to a body corporate sits outside FCA consumer-credit regulation under Article 60B FSMA RAO 2001, and one practical effect of that is that the FOS safety net does not apply to it. We explain the boundary in detail in what FOS and FSCS cover, and it is worth reading before assuming a protection exists that may not.
What the BBRS was, and what it tried to do
The BBRS was launched as a voluntary, industry-funded scheme to give certain larger SMEs — those too big for FOS — a way to resolve disputes with participating banks without litigation. It grew out of widely reported concerns about how some businesses had been treated by their lenders, and the recognition that for many of them no independent redress route existed.
In principle it was a sensible response to a real gap. In practice, it faced significant limitations. Its scope was constrained by eligibility rules around the size of the business and the timing and nature of the complaint. Only certain banks participated. And the volume of cases it ultimately resolved was, by most accounts, far lower than its founders had hoped. The scheme has been winding down, which leaves the underlying gap in business dispute resolution much as it was.
The honest state of play
Strip away the detail and the position for most business borrowers is straightforward, if uncomfortable. There is no general, free, independent ombudsman for business lending of the kind consumers enjoy. Where a voluntary scheme exists, it tends to be narrow; where it does not, the route of last resort is the courts. For a small company in dispute with a lender, that can be a daunting prospect.
We are not going to pretend this is ideal, and we are certainly not going to obscure it. For our own lending, this is precisely the situation: after our internal complaints process, the final escalation is the courts, not an ombudsman, and not the BBRS — which does not cover our lending in any case.
Why we are transparent about it
Our reasoning is simple. The absence of an external ombudsman places more weight, not less, on a lender behaving fairly in the first place and handling complaints properly when they arise. A firm that hides behind “you have no ombudsman” is telling you something about how it intends to treat you. We would rather take the opposite approach: state the position plainly, and then earn trust by how we actually behave.
In concrete terms, that means a clear, published complaints process you can use at any time, set out on our feedback and complaints page; full disclosure of costs on your Key Information Sheet (KIS) before you sign; and an honest account of what protections do and do not apply. You can verify the company itself on the Companies House register (company number 16093826).
What a business can do
Given the gap, the practical advice for any business borrowing from any lender is to do the diligence the ombudsman safety net would otherwise soften. Read the agreement in full. Make sure the costs are clear and in writing before you sign. Keep records of communications. And if difficulty arises, engage early and use the lender’s complaints process properly — and seek free, independent guidance, such as Business Debtline for business debt. The dispute-resolution landscape for businesses is thinner than many assume. The best protection is to borrow with your eyes open.
