10 Mar 2020
A number of UK banks have announced plans to offer three-month payment holidays to people hit by the Coronavirus outbreak.
Royal Bank of Scotland (RBS), Natwest and Ulster Bank will give self-isolating customers a formal break from their regular mortgage and loan repayments in an effort to help stem the global health crisis.
TSB has revealed a similar package, providing mortgage relief for affected customers for up to two months.
Barclays, RBS and TSB will also allow customers to access fixed savings accounts early without incurring any penalty charges.
Lauren Taylor, a banking litigation solicitor with Aberdein Considine, said the measures will now put pressure on other lenders to follow suit.
"Banks are cognisant of the fact that many customers will experience financial difficulty should they contract the virus, or be forced to self-isolate," she said.
"Although the government has announced that staff will be entitled to Statutory Sick Pay from the first day of isolation, ‘gig economy’ workers and those who are self-employed are likely to be hit hard financially.
"With RBS, TSB, Barclays, Natwest and Ulster Bank showing this commitment to assist customers, pressure is now on their peers to do the same."
The announcements come after Stephen Jones, chief executive at industry body UK Finance, urged lenders to consider the impact “COVID-19” will have on consumers.
He said: “Banks, building societies and credit card providers understand that some of their customers may be worried about the effect that contracting the coronavirus (COVID-19) could have on their finances, for example due to a drop in income or because of unexpected expenses or bills to pay.
“All providers are ready and able to offer support to their customers who are impacted directly or indirectly by COVID-19, which could include offering or increasing an overdraft or allowing repayment relief for loan or mortgage repayments: asking for help early is key.”
Lauren Taylor added: "Banks are likely to assess customers’ eligibility on a case by case basis and we would encourage those experiencing financial distress or worry to maintain an open communication with their lender at the earliest possible opportunity for assistance to be explored.
"Further details are expected to be announced in the days and weeks ahead."