CMA Investigating SME Lending Sector. The Competition and Markets Authority (CMA) has announced that it will be conducting an investigation into the small to medium-sized enterprise (SME) trade finance services and the personal current account sectors.
There are several concerns that the organisation has regarding the effectiveness of competition in these particular industries, including restricted transparency, the difficulties people now face in making comparisons between banks, low levels of switching and shopping around, and little movement in the market shares of the four biggest lenders.
Chief executive of the CMA Alex Chisholm explained just how important effective competition is in the retail banking sector for SMEs, individual customers and the economy as a whole.
“The Market Reference Group will investigate in detail and decide what action, if any, may be needed to improve competition for the benefit of personal and small business customers,” he remarked.
Chairman of the Retail Banking Market Investigation Group Alasdair Smith made further comments, observing that there have been a lot of concerns in recent times about the banking market and the underlying causes of these are due to be investigated.
A review of the SME undertakings from a number of banks in 2002 will be carried out, with businesses and individuals now being asked to make submissions in response to the issues that have been identified or if there seems to have been something missed out.
The final report is due to be published in April 2016, with provisional findings set to be made public in September 2015.