Barclays’ staff shortages force it to turn away new business
Barclays has been turning away companies with more than one director apply for new bank accounts as staff shortages have left the lender unable to complete anything but the most basic background checks.
Barclays has struggled to open new business accounts for more than four months, and will probably continue to reject companies with more than one director until next month at the earliest, The Times reported.
The bank has very limited capacity for companies requiring anything more than ‘bank mandates’ – a document that informs a bank who is authorised to manage the bank account.
Barclays has faced staff shortages as it has moved staff to conducting ‘know your customer’ checks on existing accounts rather than new account applications.
A Barclays spokesman told City A.M.: “We remain open for applications for start-ups and switchers that are sole traders and single-director limited companies. These can be made through our easy-to-use digital applications in our app or online. We do, however, have limited opening capacity for accounts for multi-director small businesses while colleagues focus on serving existing banking clients. We hope to have increased capacity in the coming weeks so that we can welcome all new small business customers.”
The checks on existing customers are not thought to be related to pandemic financing schemes.
The news comes after it was reported last week that Barclays had partnered with insolvency firm Manolete Partners to collect money from over 100 companies that defaulted on bounce back loans.
The British Business Bank’s (BBB’s) scheme, which enabled SMEs to access credit quickly during the pandemic, saw around £46bn worth of loans paid out to UK SMEs. The government admitted last year that up to £3.3bn could have been lost to fraud.