Emergency Covid loans carry high mis-selling risk, banks fear

Rapid roll-out of government schemes raises legal fears over inequitable client treatment

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The emergency loans and relief packages being rolled out to firms and individuals affected by the coronavirus lockdown could come with a heavy price for banks: the risk of fines and lawsuits if they offer them to customers inequitably.

During ordinary times, banks are required to rigorously assess whether new loan products meet client suitability criteria – chiefly, whether a customer actually needs the product, can afford it and that it is offered on a nondiscriminatory basis.

But the

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