Banks are being allowed by the regulator to minimise compensation for the mis-selling of complex loans to small businesses, the campaign group with over 2000 SME members has claimed.

Bully Banks says banks are adjusting redress according to the size of the claim, not its merits, and rejecting claims for consequential losses which have been hugely damaging to businesses.

The Financial Conduct Authority will tomorrow report on the final stages of the review it announced two years ago into the sale to 30,000 businesses of 'interest rate hedging products' , loans containing derivatives or swaps intended to protect businesses from interest rate rises.

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The review has found mis-selling in 93 per cent of cases, but banks under the scrutiny of FCA-approved accountants had by the end of April made redress payments to only 5,732 businesses.

Bully Banks has previously been reluctant to comment on the progress of the review, which got under way in May 2013 and was supposed to be completed at the end of last month.

But now the group says a survey of 400 of its members has found that the higher the value of the mis-sold loan, and the potential liability of the bank, the lower the willingness of the bank to make a full redress offer. For SMEs with small disputed loans of up to £250,000, banks have made full 'tear-up' compensation offers in 88 per cent of cases. But on loans up to £1m, that proportion falls to 62 per cent, and for the highest value loans of £5m and over, only 29 per cent of SMEs have been offered full tear-up redress, with 43 per cent offered a replacement capped loan. For loans over £1m, up to 30 per cent of SMEs had been offered an "alternative swap" product, which in 49 per cent of cases meant the business still owed the bank money, while for a further 23 per cent the net redress paid out was under £50,000.

Jeremy Roe, chairman of Bully Banks, said: "There is no difference at all between these groups of businesses, other than the size of the product. They are all people who are just as unsophisticated and unaware, so how is it possible, unless it is being manipulated by the banks, to deliver these results?"

Mr Roe said an equally concerning issue was consequential losses. "We have seen claims which have been properly researched and approved by lawyers, some of them quite eminent silks, being rejected by the banks with no sensible explanation. It is a disgrace that the FCA are managing a process which is clearly failing to deliver equitable redress."

He added: "This is not about people getting massive levels of compensation and running off to the Bahamas or buying a Ferrari, this is about businesses which through a conscious process of deceit implemented by their banks have been caused very significant damage."

An FCA spokesman said: "Already thousands of small businesses affected by mis-selling have received substantial redress, totalling hundreds of millions of pounds." The regulator had "put independent reviewers in place to check each decision and challenge them where necessary".

He added: "If small business affected by the mis-sale of an interest rate swap believes their "lost opportunity" costs amounts to more than the 8per cent simple interest, they are able to put together a claim for consequential loss. If that claim is rejected, banks have to explain why."