Dublin-based Internet bank Firste has set up its own legally binding adjudication service for dissatisfied customers. Since the firm has no physical presence in Britain it is not governed by UK banking regulations and has come in for criticism from consumer groups.

An independent company will run the Dispute Adjudication Service which will handle customer complaints. The announcement was received positively by the British Consumers' Association which hopes that other Internet banks falling outside the British ombudsman's remit will follow suit.

The independent adjudicator's ruling will be legally binding on First-e but will not prevent a customer from taking a case.