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Support banking reforms says FSB

The National Chairman of the Federation of Small Businesses is urging the Prime Minister not to ‘water down’ banking reform proposals.

In an open letter to David Cameron, John Walker urges him consider the findings in the Independent Commission on Banking report, due for publication

The report pledges to ‘reform the regulation and structure of the banking system’, but Mr Walker believes there is a chance the government may ignore these recommendations, and make decisions based on the views of a small influential group.

The banking community has recently claimed the reforms could have a detrimental effect on the economy, but a survey of influential City figures showed that 71 percent thought it would be bad if the Government took no action.

Mr Walker commented: “We were promised radical reform, but it now appears that this has been downgraded to ‘light touch’ regulation after 2015, if we are lucky. This is simply not good enough.

“Small businesses have had a tough time at the hands of the banking sector – with more than a third of businesses missing their growth opportunity as a result of being refused credit.”

The FSB is also calling for more competition within the banking sector, and believes the Financial Conduct Authority should be given powers to ensure small businesses get a fair deal.

He added: “The Government courted businesses with promises of reform and it is time that they stood by those promises.

“Without urgent and radical reform the banking system will never change and those businesses needed to help pull the recovery onto firmer ground will be left to struggle.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .