Finance · 16 January 2017

Banks fail to offer sufficient financial advice to small business owners

High street banks UK
In 2016, a large proportion of small business owners chose to ignore the financial advice of their bank
Almost half of small UK company owners received poor financial advice from their bank in the 12 months, which had a negative impact on business, new research has revealed.

The results of a new study into the inefficiencies of traditional banking by Amicus, a specialist lender of flexible working capital for small firms, found some 16 per cent of owners claimed their business was in worse shape because of financial advice from their mainstream lender in 2016.

As many as two-fifths of small business owners rated the service they received from their high street bank as less than good, whereas 52 per cent chose to ignore their bank’s advice altogether.

Regionally, company owners in the West Midlands and the North West of England were the most disappointed in their bank’s level of financial advice. In each region, 53 per cent of small business owners failed to rate their lender’s services as good.

Supporting small business owners with advice and access to working capital and overdraft facilities was found to be a major failing of traditional banks in the UK. Nearly a third of owners in the study didnt describe their bank as helpful? and 46 per cent claimed their lender wasnt flexible? in this regard.

Commenting on the study’s findings, Amicus managing director John Wilde said: There is a growing divide between the level of business service and the flexibility required by business owners, and the advice being offered by mainstream banks.

the research shows a worrying trend of business advice from mainstream banks been rejected or taken on board with negative consequences [for small businesses].


 
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ABOUT THE EXPERT

Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.

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