Business

Thousands of small business owners are accusing Santander of breaking its promises after the bank announced it would begin charging £9.99 a month for business accounts it had guaranteed would be “free for ever”.

The controversial move affects long-standing customers who signed up to Santander’s Free Banking Forever tariff—accounts that were marketed with a written guarantee of zero banking fees for life. Despite that pledge, affected customers have now been told they will be charged from October this year.

The decision has ignited fury among sole traders and microbusinesses who say they relied on the guarantee when choosing Santander. “Which part of ‘for ever’ do Santander think doesn’t apply now?” said a business customer since 2005 who wished to stay anonymous. “It’s not just about the money. It’s about trust—and they’ve broken it.”

Santander withdrew its free business banking offer for new customers in 2011, but existing account holders were assured their fee-free terms would continue indefinitely. The bank previously attempted to introduce fees in 2012 but was forced into a U-turn after facing threats of legal action.

Now, more than a decade later, Santander has revived the charges—this time claiming that the original guarantee no longer applies following internal mergers and account migrations.

In a statement, the bank said: “The business banking landscape has changed significantly over the last decade. As such, we are simplifying our business banking offering as the first step to ensure that we can sustainably and efficiently evolve to better meet the needs of our business customers in the future.”

It also claimed that accounts predating the 2008 merger of Abbey and Alliance & Leicester were migrated into its Business Every Day product in 2015, and that this newer account type was not covered by the “free forever” pledge.

But customers say they were never informed that their original contractual guarantees were being revoked. Jennifer Iles, a graphic designer and early adopter of the free account, said: “I objected when Santander tried to impose monthly charges in 2012. Now they’re trying again—and pretending there’s no obligation. They’ll have a fight on their hands.”

For many, the dispute is about principle rather than pounds. “If I had signed up to an account that cost £9.99 a month, that would have been my choice,” Lawrence said. “But I signed up to a bank that told me in writing that I would never have to pay fees. It was part of the deal.”

Legal experts suggest the bank could face renewed legal scrutiny if it cannot demonstrate that customers were clearly informed of the contractual change. Consumer advocates say the situation echoes wider concerns about financial institutions unilaterally shifting long-standing terms and eroding customer trust.

With Santander already under pressure to restore its reputation in the business banking sector, the decision to impose charges on its most loyal account holders may prove a costly misstep.

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Santander faces backlash over charges on ‘free forever’ business accounts

British public companies are sounding the alarm in record numbers as escalating geopolitical tensions and rising trade costs batter corporate confidence.

According to new data from EY, the second quarter of 2025 saw 59 profit warnings issued by UK listed firms—a 20 per cent rise on the previous quarter and the highest figure in years driven by global policy disruption.

The figures mark a sharp rise in business anxiety, with nearly half (46 per cent) of all profit warnings explicitly blaming geopolitical instability, up from just 4 per cent during the same period last year. It’s the highest proportion EY has recorded in more than a quarter of a century of monitoring UK corporate guidance.

At the heart of this turbulence are growing fears over international trade friction, most notably the threat of sweeping new tariffs announced by the Trump administration in April. That single month alone saw a 24 per cent spike in profit warnings compared to the year before, with 50 per cent of those attributed directly to tariff concerns and disruption in the US economy.

TT Electronics and shipbroker Clarksons were among the FTSE-listed firms highlighting tariff-related impacts on performance. Analysts warn that the combination of punitive trade policy and wider political instability is beginning to weigh heavily on strategic planning and investor sentiment.

Jo Robinson, EY’s turnaround and restructuring strategy leader, said: “The latest profit warnings data reflects the scale of persistent uncertainty and how heavy it continues to weigh on UK businesses. While global tariffs have amplified this, they are part of a broader web of geopolitical and domestic upheaval that is making forecasting incredibly challenging.”

Industrial support services and retail companies were among the hardest hit, recording eight and four warnings respectively. A toxic cocktail of external trade shocks and rising internal cost pressures—such as April’s hike in National Insurance contributions and increased minimum wage thresholds—has compounded the squeeze on margins.

EY’s data also points to a worsening employment picture. Since October 2024, UK payrolls have contracted by more than 184,000, with 70 per cent of the job losses concentrated in retail and hospitality—sectors already stretched by energy costs and changing consumer habits.

Silvia Rindone, EY’s retail sector partner, said technology investment would remain critical despite the downturn. “Retailers must get the basics right—product range, pricing and service—while continuing to invest in AI and automation to build leaner, more resilient models. That’s the route to long-term survival.”

Contract cancellations and order delays also remained at record highs in the second quarter, underscoring the fragility of both domestic and global demand.

With uncertainty now baked into the macroeconomic outlook, analysts warn that businesses must rethink how they navigate risk. “Whether the rise in warnings is cyclical or structural remains to be seen,” said Robinson. “What is clear is that scenario-based planning—combining agility with strategic clarity—is more essential than ever.”

As UK companies grapple with an increasingly unpredictable global landscape, 2025 is shaping up to be a year of testing resilience as much as delivering results.

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UK companies issue record number of profit warnings amid global policy chaos

Rightmove has slashed its 2025 house price forecast in half, citing a glut of homes on the market and increasing competition among sellers.

The UK’s largest property portal now expects average prices to rise by just 2 per cent this year, down from the 4 per cent previously predicted.

According to the company’s latest data, the volume of homes listed for sale has reached its highest point since 2015, with sellers jostling for attention in an increasingly crowded marketplace. The result, says Rightmove, is downward pressure on asking prices as vendors cut back expectations to avoid being overlooked.

The average asking price in July dropped by 1.2 per cent compared to June, falling to £373,709. While a seasonal dip is typical for this time of year, Rightmove noted that the decline was the steepest it has recorded in any July for more than two decades. Year-on-year, asking prices are now just 0.1 per cent higher than they were in summer 2024.

Colleen Babcock, head of partner marketing at Rightmove, said: “The decade-high level of buyer choice means that discerning buyers can quickly spot when a home looks over-priced compared to the many others that may be available in their area. It appears that more new sellers are conscious of this and are responding with standout pricing to entice buyers and get their home sold.”

Estate agents on the ground echoed this sentiment. Phillip Bishop, managing director at Perry Bishop in Cirencester, added: “There is significant property choice and availability for buyers, which is allowing them to be uncompromising on their criteria and expectations.”

While asking prices dipped across most regions, the sharpest monthly decline was seen in central London, where average prices fell by 2.1 per cent. Rightmove said the recent rise in stamp duty would likely have had a greater impact in the capital, which remains the most expensive area to buy a home. Additional uncertainty around proposed changes to non-dom tax rules may also be suppressing investment in prime London real estate.

By contrast, more affordable regions are still seeing modest growth. In the northeast of England, asking prices rose by 1.2 per cent in July, underlining the regional disparities in the housing market.

Despite the slowdown in price growth, there are signs of renewed activity. Rightmove reported that the number of agreed sales is up by 5 per cent compared to last year, while buyer enquiries have increased by 6 per cent. This uptick is being supported by falling mortgage rates, with the average two-year fixed deal dropping from 5.34 per cent last summer to 4.53 per cent today—equating to a saving of nearly £150 per month on a typical new mortgage.

Babcock remains cautiously optimistic. “We’re seeing more sales being agreed and more new potential buyers entering the market than at the same time last year. Still, the knock-on effect of high buyer choice is slower price growth, so we’re revising down our prediction.”

While price momentum is likely to be subdued for the remainder of the year, the combination of improved affordability, stable demand and anticipated interest rate cuts could still offer a degree of support for the UK housing market as 2025 progresses.

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Rightmove halves house price forecast as sellers flood the market