Commenting on the CMA report setting out the preliminary findings of the competition regulator’s investigation of the SME business banking market, John Longworth, Director General of the British Chambers of Commerce, said:
“Businesses have waited a year for the CMA to undertake its investigation, and many will be disappointed with the results. The CMA’s preliminary report pulls many of its punches — even if it acknowledges that some problems exist in the business banking market.
“While proposals to help SMEs switch banks or compare costs are positive moves, they are unlikely to be game-changing. The CMA is effectively endorsing a status quo that many businesses find unacceptable.
“While it chose to avoid massive structural change in the business banking market, the CMA could have suggested further remedies to boost competition, or signalled alternatives to government, such as a beefed-up British Business Bank.
“Many businesses will be concerned about the prospect of their data being shared around financial institutions. This must only occur with the business’s express consent, otherwise it creates yet another trust issue that businesses and the financial industry will have to overcome. Since businesses trust other businesses, the CMA should focus on promoting initiatives like the Business Banking Insight, which lets SMEs across the UK learn from the experiences of their business peers before choosing products and services from different banks.”
“The CMA is due to publish its final report next year. Many will hope the CMA strengthens its proposed remedies on business banking, rather than strengthen the status quo.”