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|CMA provisional decision on remedies, is the outcome what SMEs need?|
|Wednesday, 18 May 2016|
The Competition & Markets Authority this morning published its provisional decision on remedies ahead of the final investigation report being published later this year, looking at the issues hindering competition in personal current accounts and banking services for SMEs.
Aamar Aslam, CEO of Funding Invoice, comments on the provisional decision on remedies from the CMA from the perspective of SME owners: “The proposed technological changes from the CMA regarding an Open API will certainly reduce the need for SME customers to look solely to their existing personal bank for financial support. However, it still remains to be the case that not all businesses are suitable for bank lending full stop, with half of SMEs being rejected when applying for a first-time loan. Certain SME owners may find themselves outside the of the standard eligibility criteria, and therefore turned away by the bigger lenders.
It is crucial for SMEs to look to alternative funding options, even outside of the tailored price-comparison apps proposed by the CMA. Alternative finance is continuing to grow in popularity with small businesses across the UK, so SME customers must ensure that all possible funding avenues are explored to find the solution best suited to their individual business. The Small Business, Enterprise and Employment Act will only encourage banks and alternative lenders to work together for their SME customers, but until that comes into force, small businesses must take it upon themselves to look elsewhere.”
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