Business: Banks

Treasury written question – answered on 6th September 2021.

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Photo of Kirsty Blackman Kirsty Blackman Shadow SNP Spokesperson (Economy)

To ask the Chancellor of the Exchequer, what assessment his Department has made of the adequacy of business banking regulation during the covid-19 pandemic.

Photo of Kirsty Blackman Kirsty Blackman Shadow SNP Spokesperson (Economy)

To ask the Chancellor of the Exchequer, what recent comparative assessment his Department has made of the (a) performance and (b) effectiveness of (i) UK business banking regulation and (ii) that of other OECD countries.

Photo of John Glen John Glen Minister of State (Treasury) (City), The Economic Secretary to the Treasury

The government, along with regulators, are committed to ensuring that UK regulation promotes safe and sustainable financial services, while still allowing room for innovation and continually reviews its effectiveness.

It has long been the case in the UK that business lending is generally not subject to regulation – much like many other major economies such as; the US, Canada, and Australia. Ultimately, the government only looks to regulate where there is a clear case for doing so, in order to avoid putting additional costs on lenders that would ultimately lead to higher costs for business customers.

But of course, that does not mean – should things go wrong - that businesses do not have access to free, independent dispute resolution services. In fact, 99% of businesses have recourse to the Financial Ombudsman Service. And with the launch of the Business Banking Resolution Service in February this year, larger eligible SMEs also have somewhere independent to take their complaint.

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