RBS business customers have been given an extra six months to switch to rival banks under the Incentivised Switching Scheme (ISS).
The move was announced today by Banking Competition Remedies Limited as it became clear the state-owned Royal Bank was struggling to shift the targeted 120,000 clients from its books by 25 August.
The scheme under which SMEs can be paid up to £50,000 to move is part of the Alternative Remedies Package which aims to stimulate competition in the banking sector.
The deadline for customers to apply has now been extended from 25 August 2020 until the end of February 2021. They will have until the end of June 2021 to complete the switch.
Criteria for ISS will also be broadened to make it available to an extra 200,000 more RBS and NatWest business banking customers with turnover of up to £1 million from 25 August 2020.
RBS said: "As a result of the on-going COVID-19 pandemic, fewer customers have been switching under ISS and these changes are being announced by BCR to preserve the momentum and aims of the ISS. Bringing forward these changes now, which might otherwise have been implemented at a later date."
It added: "These amendments to the ISS do not change the total number of customers targeted to switch under the scheme. As a result, there is no material change anticipated to the current financial outlook for RBS. The existing requirement on RBS to make a potential further contribution to the ISS, should customer switching be insufficient under the Deed, remains capped at £50 million."
Under the scheme, customers can switch to Arbuthnot Latham & Co; Clydesdale Bank; Co-operative Bank plc; Hampden & Co; Handelsbanken; Metro Bank; Santander UK; Starling Bank; TSB Bank Monzo; Nationwide Building Society.
To qualify, firms must have been an RBS customer before 5 November 2018, with a turnover of less than £25 million and must not be in financial trouble.
