<
p>The CMA has issued First Trust Bank and HSBC with written directions so that they comply with SME banking requirements.
Following an investigation concluding in 2002, eight major UK banks have been prohibited by “legally-binding undertakings” from SMEs to open business current accounts with them. This was in order for funders to be able to compete effectively regarding SME banking, and to safeguard customer choice.
However, following The Competition and Markets Authority (CMA) investigationg into the eight banks, it found that the two banks, First Trust Bank in Northern Ireland and HSBC have both breached the undertakings.
The CMA has therefore issued detailed directions to the two banks to “ensure that these companies and their staff comply with the undertakings.”
Two other banks were also found to have staff with relatively low awareness of the undertakings.
It was stated that a further audit will be required again of the eight banks by July 2015.
Commenting on the findings, Alex Chisholm, CMA Chief Executive, said: “Breach of these undertakings is a serious matter and we have directed First Trust Bank and HSBC on the actions they must take to immediately correct the situation – so that it is clear to both their staff and their SME customers that obtaining a business loan is not dependent upon opening an account.
“Although all eight banks have recognised the importance of complying with the undertakings and are taking steps to address this, when breaches occur we need to ensure that there will be full compliance. In addition, all eight banks will need to show that they have the correct systems in place to ensure that ‘bundling’ will not occur in the future, and we are requiring a further audit next year to confirm this.”
He added: “In the meantime, we would encourage SME customers to get in touch with us with any concerns they may have about the compliance of any of the eight banks with these obligations.”
The CMA has issued First Trust Bank and HSBC with written directions so that they comply with SME banking requirements….
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