NatWest Bounce Back Loan Refusal

Ali15d

Dear MSE Members, 
Hope everyone is well during this pandemic and staying safe. I have a problem which i would like some guidance and advise on please. 
So on the 26th of May I applied for a BBLS loan with NatWest as my business bank account is with them. I have a foundation business account for my LTD business. In addition my personal account has been with them over 10 years.

On applying for the BBLS with NatWest on the same day i got the emails back from echosign. 
Three emails in total

• Email one was acknowledgement (Thank you for your submission)
• Email two was the form (Acceptance requested on "Bounce Back Loan Scheme (BBLS) Customer Application Form)
• Email three was the letter (Acceptance requested on "Important information relating to your recent BBLS application) (attached image 1)

Before I proceed,  a bit of background on the business

1. LTD was Incorporated on 30 January 2020 with companies house
2. Foundation account was opened by NatWest in February 2020
3. One signatory, One Director, One Secretary (all the same person i.e me)
4. The nature of business is not in a restricted sector

So from my understanding of the scheme, my application was or should have been pretty much straight forward regardless of the delay.
Since the 26th of May I have been chasing the status of the application; I was told so many different reasons as to why my application was taking time by NatWest. 
For example, technical problems, volume of applications, application requires further checks, and so on. 

I did raise a complaint by emailing the CEO but the complaint was handed over to a complaint assessor who has in my opinion not been very helpful. He too was telling me different excuses.

At one point, i think in week 3, i was told that my application had a technical problem and i should submit another application which i did. Two in fact. However still kept getting the same emails with the same letter as before (further checks).

Now yesterday, i received a email from NatWest, thinking finally some good news - but nope it was a decline letter (attached image 2).  
I called up the bank and they just read to me again what was mentioned on the letter. Not very helpful. 

What NatWest are saying is
'Unfortunately, we cannot proceed with the application because of information we received as part of our usual checks and assessments. Please note this application has been cancelled.'

Pretty concerned so i did my own digging on my credit files, all three of them, to see what is so adverse that i failed their checks and assessments.  
There are no CFAIS warnings, i have never been involved in money laundering or any illegal activities, no fraud markers internally (i asked them this), never been bankrupt, never been disqualified and so on, basically i can not find or think of any reason as to why i would have failed these checks. 

My question is what can i do next? how do i find out the information they used because it is pretty concerning?   

My options are very limited because not many banks are opening new business accounts and those who are most likely will perform a credit check as part of opening a new business account so it hinders my chances somewhat.

This month has just been horrible for me. On Tuesday i found out my mum has cancer which she is going to start chemo next week, so that being on my plate NatWest have just added onto the stress for no reason.  

Any help and advice much appreciated. 

Jeremy535897

I wonder whether they have treated the second application as invalid as the first one was still ongoing, despite telling you to make it. As the business account was already in existence, it shouldn't be credit checks. What turnover figure did you use?

Ali15d

£250,000. 

Jeremy535897

You must have used a projected turnover figure as the company was only formed on 30 January 2020. Was it actually trading by 1 March 2020? I am also wondering whether using a projected turnover figure that is round, and sufficient to get the maximum amount of loan, raised doubts.

Ali15d

Yeah business was trading. I think by March it was generating around £19000-£20000 a month roughly. 

Ali15d

After March turnover reduced because there were not enough demand.

Jeremy535897

The FAQs say:

"What checks will I be subject to?

Applicants are required to self-declare they meet the eligibility criteria for the Scheme. Applications from eligible borrowers will be subject to customer fraud, Anti-Money Laundering (AML) and Know Your Customer (KYC) checks."

You already have a business bank account so they cannot have had any issues with KYC or AML. If they were concerned about customer fraud, I would have expected them to give notice that they want to close the account. I would therefore ask what it was that made them cancel the application. Point out that if you can't even get a BBL from your own bank, why would you be able to get something with more checks from a bank that doesn't know you, yet they suggest referring you elsewhere?

Grumpy_chap

Irrespective of your March turnover, does the £250k used in your BBLS application match whatever business plan you shared with NatWest to open the account in January?

Whether accurate or not, there is a loan scheme on favourable terms with a limit of 25% of turnover up to a maximum turnover of £250k.  That uses 2019 turnover, except for new business that can use a forecast turnover.

The bank may have rung alarm bells with a startup company coincidentally forecasting turnover to match the limit of the scheme.

Ali15d said:

Yeah business was trading. I think by March it was generating around £19000-£20000 a month roughly. 

You "think" "around" "£19-20k" "roughly".  If I started a business 31 January, I would know exactly what my turnover was in March, to the penny.

Ali15d

1. No business plan ever shared with Natwest. Just applied online a week later account opened. 

2. The second loan scheme I believe may do a credit check so 50/50 chances of getting it. 

3. The word “think” I was referring to the was month. Ie figure of speech. Just typed as I was thinking. 

In regards to turn over NatWest surely could of checked the monthly figures on my account as I said it’s aprox £20k a month incoming - and I do know my figures to the penny. Just something I don’t want to share to the penny.   

Irrespective of them getting “spooked” the loan is 100% backed by the government so there is really no risk to them. 

Grumpy_chap

I am not sure what you refer to by "the second loan scheme".

Turnover of 1 month (March) may not be representative, so it is not that simple for the bank.  Even if the bank did that then £19-20k multiplied by 12 is not £250k.  That may have been sufficient discrepancy to raise a flag.

The loan being underwritten by the Government is almost certainly going to be a last resort and the banks will need to exhaust all other efforts before calling on the underwriting.

MovingForwards

CIFAS will only show on your credit report if you were a victim of fraud, if you committed or were suspected of committing fraud it wouldn't show.
National Hunter hold CIFAS details and it would be worth a look to cover that side.

No financial institution can say there are internal markers for fraud as it would be classed as tipping the customer off.

All you can do is try another bank.