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Better SME banking could boost UK economy by £70 billion.

BY: GUEST AUTHOR

TAGS: Banks

A report by TSB reveals that giving small businesses access to better banking products and advice could not only give them a 10% increase in their productivity but boost the UK economy by £70 billion.

SME success and productivity rates are essential to the UK economy, but often these small businesses struggle due to lack of support.

The report shows that few SMEs feel they get value from their bank:

  • 49% of SMEs believe that the performance of their bank is holding their business back.
  • 47% of small businesses believe that they pay an unfair amount in business banking charges.
  • 68% believe their needs are being overlooked in favour of larger, more profitable companies.
  • 24% of small businesses say they have access to advice, tools, and services that give their business the confidence to be more digital
  • 60% have no idea what services their bank can offer to help them become more productive.

These results show that small businesses are missing out on services from their bank that could help them accelerate their growth. Over three-quarters (76%) feel they do not have the confidence for their business to be more digital, suggesting there is a big opportunity to provide more support to help more SMEs take advantage of going digital.

TSB’s SME banking director, Richard Davies, said: “Small businesses are the beating heart of our local communities, but as our research shows, more needs to be done to help them start, run and grow.”

In order to remove the barriers for growth for UK SMEs a new approach must be implemented:

  • Banks should improve their small business offer, to help SMEs access best-in-class technology and business services.
  • Banks should provide access to local advice and support to help SMEs manage and grow their business.
  • Banks should come clean on fees and charges, offering fairer pricing practices for smaller businesses.

If all small businesses in the UK had access to these types of productivity gain it could deliver a £70 billion boost to UK GVA. TSB noted that even if only 1 in 10 small businesses were to benefit, the impact on our economy would be significant.

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