BusinessCompany NewsScottish SMEs miss out on banking benefits

Scottish SMEs miss out on banking benefits

Scottish SMEs are set to miss out on the main benefits of chancellor Gordon Brown's crackdown on the Big Four banks, in particular, the option of having either free banking facilities or an interest-bearing current account.

Speaking in Commons yesterday, Treasury economic secretary Ruth Kelly said this was because the Competition Commission – the body responsible for a damning report on the Big Four banks and proposals for reform – found no evidence that in Scotland the banks have been making excess profits.

Replying to a question in the Commons, she said the big Scottish banks would not therefore be required to offer the concessions, though other remedies will apply North of the Border.

In March, the commission accused the Big Four banks – Barclays, Lloyds TSB, HSBC and Royal Bank of Scotland – of operating a ‘complex monopoly’ and making excessive profits.

The proposal that banks offer SMEs interest at a base rate of minus 2.5% on current accounts, free money transmissions, or a choice between the two, where there is evidence of ‘excessive charging’, has the backing of the chancellor and is expected to be announced in the Budget tomorrow.

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