Question to the HM Treasury:

To ask His Majesty's Government what assessment they have made of the impact on small businesses of many banks, including HSBC, NatWest and Santander, not allowing them to open accounts.

The Government recognises the vital role SMEs play in fuelling economic growth, and it is important they can access the banking services they need.

Last year the Chancellor asked the FCA to collect evidence to help the Government understand where account closures and refusals are happening and why. The FCA published their initial findings on 19 September, and are doing further work with firms to verify the data and to better understand the reasons behind account refusals. In addition, the Treasury is continuing to engage with industry to understand any existing or emerging issues regarding bank account access for businesses.

On 21 July, the Government published a policy statement setting out its plans to strengthen requirements relating to users’ payment service framework contract terminations. This will increase the minimum notice period in cases of contract termination to 90 days – giving customers more time to challenge a decision through the Financial Ombudsman Service, or find a replacement service. Providers will also be required to spell out to the affected customer why they are terminating their contract – increasing transparency and aiding customers’ ability to appeal decisions. Both requirements will be subject to certain exceptions, including if to do so would be unlawful.