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SMEs 'missing out because of poor banking'

Published On 31 May 2007 at 09:03:24

British small and medium-sized enterprises (SMEs) are missing out on over £1 billion of interest because they are not putting their money in sensible business accounts, a new report indicates.

According to Standard Life, many SMEs in the country are not making the most of their finances because they continue to use business bank accounts which only pay small amounts of interest on their money.

Standard Life's figures show that 60 per cent of SMEs feel unhappy with their banking services, but 26 per cent admit that they have not set up an appropriate business banking account.

Indeed, just one in ten of the SMEs questioned said that they feel like they use their savings account effectively.

"We are urging SMEs to make the most of the cash they have sitting in low-paying business current accounts," explained Allison Crawford, the sales and marketing director for Standard Life Bank.

"By switching to a higher paying business savings account, small businesses, charities and clubs could get significantly better returns on their money."

Earlier this year, the Federation of Small Businesses (FSB) said that UK banks were still not acting with the interest of SMEs in their minds.

"There has to be a culture change within the banks so that they understand the needs of their small business customers and can then deliver even better services for them," said Mike Cherry, the FSB's financial affairs chairman.

 

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