Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether she has had discussions with the Secretary of State for Business and Trade on the cost of business loans offered by IWOCA.

I refer my honourable friend to the answers I provided on the topic of SME lending on 23 October, and more recently in relation to the rate of short-term lending to small and medium sized businesses in the UK.

Interest rates, including those offered by individual providers, are a commercial matter decided by the lender concerned, reflecting the base rate, the risk of the applicant, and a margin to make the loan commercially viable given the cost of underwriting and broader funding costs. The Government does not intervene in commercial decisions, and SMEs should should shop around to find the product that best suits their needs when choosing finance, which in turn helps drives competition, improves choice, and may support pricing.

More widely, case complaints are a matter for the Financial Ombudsman Service rather than the Government, where the Treasury receives correspondence across a wide variety of subjects including financial services. While we are not able to measure the number of complaints the department receives in relation to high-cost credit for business loans (or in relation to an individual provider), the volume of correspondence on the cost of credit in relation to business loans, is generally low.