Originally written by Timothy Adler on Small Business
Lloyds has been named and shamed with for forcing small businesses to open paid-for business current accounts to access Bounce Back Loans.
The competition watchdog said that Lloyds, one of the largest in the small business market, treated small companies unfairly by requiring them to open an account to draw down state-backed Bounce Back Loans.
The Competition and Markets Authority that 30,000 customers who had been running their businesses using personal accounts were told by Lloyds and its Bank of Scotland arm that they must open a business account to access Bounce Back Loans.
>See also: Banks ‘will be pushed’ into closing down SMEs unable to repay Covid debt
The scheme, which has underwritten £35.5bn of credit, provides lenders with a 100-per-cent state guarantee on low-interest loans to qualifying small companies. High street banks, rather than the government, have to provide the working capital.
Back in 2002, Lloyds agreed not to ask personal account customers to open a separate account if they wanted to borrow money from the bank – a practice known as “bundling”.
But when it came to Bounce Back Loans, Lloyds asked existing customers operating their firms out of personal accounts to open fee-charging business accounts
Tag Archive for Small-business Banking
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Lloyds rapped for forcing Bounce Back Loans borrowers to open accounts
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Lloyds has been named and shamed with for forcing small businesses to open paid-for business current accounts to access Bounce Back Loans.
The competition watchdog said that Lloyds, one of the largest in the small business market, treated small companies unfairly by requiring them to open an account to draw down state-backed Bounce Back Loans.
The Competition and Markets Authority that 30,000 customers who had been running their businesses using personal accounts were told by Lloyds and its Bank of Scotland arm that they must open a business account to access Bounce Back Loans.
>See also: Banks ‘will be pushed’ into closing down SMEs unable to repay Covid debt
The scheme, which has underwritten £35.5bn of credit, provides lenders with a 100-per-cent state guarantee on low-interest loans to qualifying small companies. High street banks, rather than the government, have to provide the working capital.
Back in 2002, Lloyds agreed not to ask personal account customers to open a separate account if they wanted to borrow money from the bank – a practice known as “bundling”.
But when it came to Bounce Back Loans, Lloyds asked existing customers operating their firms out of personal accounts to open fee-charging business accounts
Hot Business News Today
Banks ‘will be pushed’ into closing down SMEs unable to repay Covid debt
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Banks will be pushed into foreclosing on small businesses unable to repay Covid debt, a City insider has warned.
This is because foreclosing on SMEs unable to repay emergency coronavirus loans will be the only way banks can trigger the government’s guarantee to repay bad Covid debt. Banks would have to prove a loss before they can claim on the guarantee.
The government’s lending schemes have provided nearly £53bn to some 1.2m companies, including £35.5bn worth of bounce back loans — which include a 100 per cent guarantee for small business loans – and £13.7bn through the coronavirus business interruption loan scheme (CBILS).
The Office for Budget Responsibility has warned that in a worst-case scenario, £35bn of the Covid debt will never be repaid. The banks themselves believe that up to half of bounce back loans alone will never be repaid.
A Business Banking Resolution Service survey in May discovered that nearly half of small businesses that have taken out government emergency coronavirus loans do not intend to repay them.
The Treasury has turned a deaf ear to a City of London push for it to set up a bad COVID-19 debt bank, an idea proposed by Lord
Hot Business News Today
Banks ‘will be pushed’ into closing down SMEs unable to repay Covid debt
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Banks will be pushed into foreclosing on small businesses unable to repay Covid debt, a City insider has warned.
This is because foreclosing on SMEs unable to repay emergency coronavirus loans will be the only way banks can trigger the government’s guarantee to repay bad Covid debt. Banks would have to prove a loss before they can claim on the guarantee.
The government’s lending schemes have provided nearly £53bn to some 1.2m companies, including £35.5bn worth of bounce back loans — which include a 100 per cent guarantee for small business loans – and £13.7bn through the coronavirus business interruption loan scheme (CBILS).
The Office for Budget Responsibility has warned that in a worst-case scenario, £35bn of the Covid debt will never be repaid. The banks themselves believe that up to half of bounce back loans alone will never be repaid.
A Business Banking Resolution Service survey in May discovered that nearly half of small businesses that have taken out government emergency coronavirus loans do not intend to repay them.
The Treasury has turned a deaf ear to a City of London push for it to set up a bad COVID-19 debt bank, an idea proposed by Lord
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Do you need a business bank account? Which one is right for you?
by Ben Lobel • • 0 Comments
Originally written by Ben Lobel on Small Business
While it may be tempting to start your new business venture without looking at the need for a bank account dedicated to your business activity, this might not be the smartest of choices.
As your business grows and expands, it’s extremely important to separate your business finances from your personal, day-to-day living.
New start-ups and part-time business owners have a habit of co-mingling their finances with their personal money, and while it may be the easiest, most convenient and cheapest way of operating, it can have its drawbacks – especially further down the line.
Any prospective business owner should treat their business as a business, regardless of whether it’s a part-time venture or not; while setting up a separate business bank account means additional bank fees and expenses, you are also storing up a lot of hassle for yourself in the future.
Many people already in business will vouch that keeping your business spending separate to your personal account ensures better manageability.
And while many business current accounts available charge you for their services, there are others that waiver the charge as long as you pay in more than a certain amount each month.
Make sure that you shop
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What do SMEs think is the best business bank account? – survey
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Handelsbanken has been voted the clear winner when it comes to what SMEs think is the best business bank account.
The Swedish bank, which has more than 200 UK branches, came top of the leader board in four out of five categories, according to the latest Competition and Markets Authority survey published this month.
The bank was named best for overall service quality (79 per cent); relationship/account management (86 per cent); SME overdraft and loan services (78 per cent); and services in branches and business centres (73 per cent) for the fifth time by the survey.
>See also: Business Banking Resolution Service opens doors in November
However, Barclays beat it to the top spot for online and mobile banking services.
BVA BDRC surveyed nearly 17,000 small business customers between July 2019 and June 2020, asking them if they would recommend their provider to other SMEs.
Mikael Sorensen, UK CEO of Handelsbanken, said: “We are particularly pleased to see this response coming from our SME customers, many of whom we have been working closely with to provide a range of tailored, flexible support.”
>See also: 12 of the best digital banking platforms for small business
Overall service quality – Handelsbanken
Handelsbanken was ranked
Hot Business News Today
Do you need a business bank account? Which one is right for you?
by Ben Lobel • • 0 Comments
Originally written by Ben Lobel on Small Business
While it may be tempting to start your new business venture without looking at the need for a bank account dedicated to your business activity, this might not be the smartest of choices.
As your business grows and expands, it’s extremely important to separate your business finances from your personal, day-to-day living.
New start-ups and part-time business owners have a habit of co-mingling their finances with their personal money, and while it may be the easiest, most convenient and cheapest way of operating, it can have its drawbacks – especially further down the line.
Any prospective business owner should treat their business as a business, regardless of whether it’s a part-time venture or not; while setting up a separate business bank account means additional bank fees and expenses, you are also storing up a lot of hassle for yourself in the future.
Many people already in business will vouch that keeping your business spending separate to your personal account ensures better manageability.
And while many business current accounts available charge you for their services, there are others that waiver the charge as long as you pay in more than a certain amount each month.
Make sure that you shop
Hot Business News Today
What do SMEs think is the best business bank account?
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Handelsbanken has been voted the clear winner when it comes to what SMEs think is the best business bank account.
The Swedish bank, which has more than 200 UK branches, came top of the leader board in four out of five categories, according to the latest Competition and Markets Authority survey published this month.
The bank was named best for overall service quality (79 per cent); relationship/account management (86 per cent); SME overdraft and loan services (78 per cent); and services in branches and business centres (73 per cent) for the fifth time by the survey.
>See also: Business Banking Resolution Service opens doors in November
However, Barclays beat it to the top spot for online and mobile banking services.
BVA BDRC surveyed nearly 17,000 small business customers between July 2019 and June 2020, asking them if they would recommend their provider to other SMEs.
Mikael Sorensen, UK CEO of Handelsbanken, said: “We are particularly pleased to see this response coming from our SME customers, many of whom we have been working closely with to provide a range of tailored, flexible support.”
>See also: 12 of the best digital banking platforms for small business
Overall service quality – Handelsbanken
Handelsbanken was ranked
Hot Business News Today
Business Banking Resolution Service opens doors in November
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Businesses that feel they have been unfairly treated by the banks will have somewhere new to turn to from November.
Business Banking Resolution Service (BBRS) will open its doors to complaints from unhappy business banking customers from mid-November.
The dispute resolution service will adjudicate in arguments between banks and unhappy SME borrowers and means that businesses do not have to resort to expensive and risky litigation.
>See also: Nearly half of small businesses do not intend to repay government loans
However, the Business Banking Resolution Service will only be open to larger SMEs with turnover in excess of £6.5m a year and with assets of £7.5m on their books.
Microbusiness complaints will continue to be handled by the Financial Ombudsman Service (FOS), particularly any disputes over bounce back loans.
BBRS has come into existence following widely publicised unhappiness from SMEs about how they were treated after the 2008 financial crisis, often with loans being unfairly called in without warning.
Following pressure from MPs, especially the All Party Parliamentary Group on Fair Business Banking (APPG), a working group with representatives from the SME Alliance, Federation of Small Business and others, set out plans for an impartial ombudsman.
>See also: Half of small
Hot Business News Today
Business Banking Resolution Service opens doors in November
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Businesses that feel they have been unfairly treated by the banks will have somewhere new to turn to from November.
Business Banking Resolution Service (BBRS) will open its doors to complaints from unhappy business banking customers from mid-November.
The dispute resolution service will adjudicate in arguments between banks and unhappy SME borrowers and means that businesses do not have to resort to expensive and risky litigation.
>See also: Nearly half of small businesses do not intend to repay government loans
However, the Business Banking Resolution Service will only be open to larger SMEs with turnover in excess of £6.5m a year and with assets of £7.5m on their books.
Microbusiness complaints will continue to be handled by the Financial Ombudsman Service (FOS), particularly any disputes over bounce back loans.
BBRS has come into existence following widely publicised unhappiness from SMEs about how they were treated after the 2008 financial crisis, often with loans being unfairly called in without warning.
Following pressure from MPs, especially the All Party Parliamentary Group on Fair Business Banking (APPG), a working group with representatives from the SME Alliance, Federation of Small Business and others, set out plans for an impartial ombudsman.
>See also: Half of small