Santander is to introduce an annual compliance fee for its panel members, in a move that the Law Society has called ‘deeply disappointing’.

The lender will also open its panel to new firms in August.

In a letter to panel members, the bank outlines its plans to move to a new web-based conveyancing panel management system to reduce mortgage fraud.

It says firms will have to pay £99 plus VAT for annual compliance checks, and will be required to upload their indemnity insurance certificate and practising certificate directly onto the system.

Santander told the Gazette that the bank will also allow new firms to apply to its panel through the web-based platform from August. This will be served by an external provider which will charge a fee of £199 plus VAT for processing the application.

A spokeswoman said the new system would increase efficiency and minimise the need to further cut the number of firms on the panel. She said that Santander would not be making any profit from the arrangement, and there was ‘no scope’ for it to pass the fee on to its customers.

A Law Society spokesman said: ‘It is deeply disappointing that Santander will charge firms a fee to apply to its panels with the minimum level of discussions about alternative solutions. This is an area where, in the interests of all parties, there needs to be uniformity of approach throughout the lending community.’

A partner at a firm currently on the panel, who did not want to be named, suggested the annual fee was designed to remove smaller firms from lender panels.