‘Unfair banking’ and ‘damaging’ financial rules harming UK’s small firms, MPs warn

Treasury committee says ‘debanking’ and use of personal guarantees for loans is putting small businesses at risk

Unfair banking practices and “damaging” financial regulators are harming small businesses and putting innovation and growth at risk, parliament’s Treasury committee has warned.

A report from the committee’s inquiry into access to finance for small and medium-sized enterprises (SMEs) said a lack of supportive policies were compounding problems for firms that had survived a “torrid” five years, which included the global pandemic and energy crisis.

“Confidence amongst SMEs in accessing finance has fallen and acceptance rates for business credit has lowered significantly,” the report said.