Question to the HM Treasury:

To ask His Majesty's Government, following reports that many small and medium-sized enterprises (SMEs) have had their bank accounts closed, what steps they are taking to ensure SMEs have continued access to banking services.

While the decisions about what products are offered to individual businesses remain commercial decisions for banks and building societies, 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 are now doing further work to better understand the reasons behind account refusals.

The Government is also acting to increase customer protections, increasing 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 – and requiring providers to spell out to affected customers why they are terminating their contract. Both requirements will be subject to certain exceptions, including if to do so would be unlawful.