UK banks to pay up to $2 billion for mis-selling credit card protection

Barclays Bank
Adam Jeffery | CNBC

The U.K. banking regulator says it has reached a deal with 13 major banks and credit card issuers to compensate customers who were mis-sold credit card protection.

The bill could be up to £1.3 billion ($2 billion), the Financial Conduct Authority (FCA) said in a statement on Thursday.

The compensation will cover seven million customers who were mis-sold protection for identity theft and credit card fraud.

This is the latest scandal to hit the U.K. banking industry after mis-selling of payment protection insurance to customers and interest rate hedges to small businesses.

Barclays, RBS, Santander and HSBC are among the banks that will be hit by the new charges.

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