Thousands of customers have been mis-sold loans that covered the cost of putting solar panels on their roofs.
Homeowners signed up on the understanding that the panels would ‘pay for themselves’.
But borrowers later found that their loan repayments outstripped any savings made on their electricity bills.
False economy: Many homeowners who took out a loan to cover the cost of installing solar panels discovered the repayments outstripped any savings made on their electricity bills
Around 2,000 people have complained to the Financial Ombudsman Service in the last year alone.
It is estimated that the number of people affected by the scandal could be as high as 20,000.
Solar companies sell the panels themselves. But the banks who provide loans for the schemes are responsible for any alleged mis-selling.
The Ombudsman says its investigations found ‘evidence of pressure sales techniques, and misleading sales literature or representations by the salesperson’.
It also found that many of those who were allegedly mis-sold credit were ‘retired or approaching retirement’.
Borrowers were then left in financial difficulty or as much as £1,000 worse off because the solar panels ended up costing them more money than they saved in energy bills.
Three-quarters of last year’s complaints were about loans with three lenders: Barclays Partner Finance (part of Barclays Bank); Shawbrook Bank; and Creation Consumer Finance (part of BNP Paribas).