Businesses are monopolising small claims courts and crowding out the people the courts were designed to help, a consumer watchdog has warned.

A report by national consumer champion Consumer Focus warns that business is ‘clogging up’ the small claims courts and causing delays for individual claimants.

It said the small claims court process is confusing, and six out of ten people with a potential claim do not even consider using it. Banks, debt recovery solicitors and issuers of credit or store cards now bring more than half of all cases. Around 47,000 cases were heard in 2008-09.

The report says that three-quarters of people who use a small claims court are ‘happy’ with the procedure. A third had prior knowledge of the claims process and a quarter found it ‘intimidating’. Although the service was set up to allow consumers ‘quick, cheap and informal access to justice’, one in five instructs a solicitor. In a quarter of cases where money is awarded it is not paid in full, the report says.

Consumer Focus deputy chief executive Philip Cullum said: ‘The increasing monopolisation of the system by big business means that individual consumers are being crowded out. It’s time for action to re-focus small claims courts on the people they were designed to help. The Ministry of Justice needs to boost people’s understanding of the process, speed it up and make it easier for people to get the compensation they are awarded.’