HSBC has been fined £6.2 million by the City watchdog for failing to help customers in financial difficulty.
The Financial Conduct Authority (FCA) said lenders failed to take into account customers' circumstances or sometimes “acted disproportionately” when they defaulted on repayments.
The FCA said the bank's actions put “1.5 million people at risk of greater financial harm”.
HSBC told the BBC: “Since these issues came to light we have invested in processes and are pleased to have been able to resolve these historic issues together with the regulator.”
The FCA said HSBC, which also provides financial services to M&S Bank, failed to take into account customers' circumstances in relation to late payments between June 2017 and October 2018.
Affordability assessments aren't always carried out when people are trying to reduce or clear late fees, leaving some customers in further financial trouble.
These assessments are to see if the person can afford the additional payments.
The watchdog also said HSBC “sometimes took disproportionate actions where people were at risk of greater financial hardship if they defaulted on their payments.”
It said the bank's policies and procedures were not sufficient to prevent the failure and that staff training was also flawed.
“People must be able to trust that their lenders will treat them fairly when they are in financial difficulty,” said Therese Chambers, joint executive director of enforcement and market oversight at the FCA.
“By failing to do so, HSBC risked significant financial harm to 1.5 million people.”
HSBC itself was reported to the FCA in 2018 over issues with how it dealt with customers in financial difficulty.
The company said it had invested £94 million into identifying and resolving the issues, and paid out a total of £185 million in compensation to more than 1.5 million customers.
The bank could have faced an even higher fine of £8.9m from the FCA. However, the FCA said it had taken into account HSBC's redress and compensation program and settlement agreement.