Connect with us

Hi, what are you looking for?

Finance

Open letter calls on Grant Shapps to boost SME credit access through improved data sharing

<?xml encoding=”utf-8″ ??>

Codat – the universal API for small business data – and a group of lenders have written an open letter to Secretary of State for Business, Energy and Industrial Strategy, Grant Shapps, calling for the government to support improved data sharing initiatives to tackle the difficulties faced by SMEs in accessing credit.

The letter has been co-signed by Atom Bank, Funding Circle, iwoca, Allica Bank, SPRK Capital, Recognise Bank, Plaid, Playter, OakNorth, Wiserfunding and TrueLayer. It has also received support from the Federation of Small Businesses (FSB).

Difficulty accessing funding is one of the biggest barriers to SME growth. The problem exists because the SME lending landscape is not set up for businesses or lenders to succeed. It’s too difficult for lenders to access accurate, up to date data to make informed decisions and loan applications are too complex and time-consuming for SMEs.

Stimulating growth in the SME sector – which contributes 50 percent of GDP and 60 percent of employment in the UK – is key to ending the ongoing recession. Improved data sharing between the financial tools used by SMEs and lenders is key to solving the problem, as set out in the ‘Closing the small business funding gap’  research report.

The technology required to improve data flow and accessibility between the financial tools used by SMEs and lenders already exists. Legislative support from the government to progress on Open Banking, support lenders and small businesses is long overdue.

The letter calls on the government to pass the Data Protection and Digital Information Bill, ensuring that the legislation applies to data needed for SME underwriting. And, to move swiftly to consult with the industry on how technology can be implemented to improve SME access to credit.

Pete Lord, Codat CEO, says “We in the industry are ready to drive the implementation of this progressive technology and legislative support from the government can play an important role in ensuring its success.”

Martin McTague, National Chair of the FSB, says: “Small businesses’ access to finance is essential for growth, investment, and innovation, and we’re concerned that our research indicates that small firms’ appetite for external finance is reducing. At the same time, the number of those accepted for finance is falling, while the interest rates offered to those who do succeed are rising fast.

“We’re going to need to explore new ideas to change this around, such as the lending passport, which has the potential to help small firms in their search for funding by simplifying the application process, saving them time and duplicated effort. Anything which promotes competition and a greater range of options in the finance market is especially critical, and especially welcome, right now.”

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Finance

Students at any level in their college life find the use of assignment writing services for professional assignment help important. Daily, students in...

Stock Markets

YORDENIS Ugas celebrates with his team after defeating Manny Pacquiao in a world welterweight championship bout at T-Mobile Arena. — REUTERS By Michael Angelo...

Finance

Competition is very tough right now. We all know that right now, people are preparing for exams in a manner in which they have...

Stock Markets

A common occurrence, catching a cold can happen anywhere at any time. And in this new normal, sensing the chances or risks of getting...

Disclaimer: CaptainOfSuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice.
The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 Captain Of Success. All Rights Reserved.