This inquiry will consider the state of the SME finance market under the following themes:
Funding options available to SMEs.
- The availability and uptake of different sources of funding for SMEs, including banks, peer-to-peer lenders and crowdfunding
- The level of competition in the SME lending market and the impact of recent regulatory initiatives
- Trends in SME finance and how potential changes to regulation and redress may affect the market
- Any sources of finance which SMEs will not consider or approach and why
The ability of SMEs to resolve disputes and access fair and reasonable compensation when they borrow money.
- The effectiveness of existing arrangements for dispute arbitration and settlement
- The merits of the Financial Conduct Authority’s proposals for expanding SME access to the Financial Ombudsman Service
- The case for establishing a new “tribunal” body for settling SME banking disputes and the means by which such a body could be created
- The design, governance and operation of such a tribunal body, and the potential relationship between it, the Financial Ombudsman Service, and the Financial Conduct Authority
- The impact of additional avenues for redress on (i) the balance of power between SMEs and lenders; and (ii) the supply of, and demand for, credit
The regulation of SME lending.
- The level of protection currently afforded to SMEs when they borrow money
- The case for bringing lending to SMEs within the regulatory perimeter, including (i) the likely impact on the supply of, and demand for, credit; and (ii) lessons learned from past misconduct
- Other non-regulatory or quasi-regulatory options for policing SME lending, such as the establishment of industry codes and standards