June 2018 marks the one year anniversary since new principles were agreed across Europe on the feedback banks should give SME customers when declined for credit. The High-Level Principles, signed by representatives of Europe's banks and its Business Groups (in the presence of the European Commission), marked another step in the Capital Markets Union Action Plan.

The principles recognise the importance of SMEs to the EU economy and the crucial role of banks in their success. Though most bank finance applications are successful, it is important that SMEs are provided with constructive feedback and information, particularly if declined credit. The principles made this standard across Europe.

Banks in the UK have long had the provision of feedback as par for the course with lending applications. Indeed we also go beyond this, ensuring that businesses also have two clear next steps offered to them if they are turned down for finance. SMEs can lodge an appeal which means that a second person will review the application. This whole process is overseen by an independent reviewer, currently Professor Russel Griggs OBE.  He believes that ?well over £100m has been put back into the economy? by the process. Secondly, eligible businesses will also be offered the right of referral to three government designated finance platforms. These platforms will offer SMEs the opportunity to have their application considered by a much broader range of bank and non-bank funding options.

The new Lending Standards Board-overseen Standards of Lending Practice are also clear that all 20 of the signatories to these must ensure that ?if an application for a product is declined, [banks] ensure that they understand the reason(s) behind it in order to be able to convey, where appropriate, this information to the customer?. There is no reason all banks should not be providing this across Europe.

This Thursday I will be speaking at a European Banking Federation (EBF) event reflecting on one year on from the launch of the principles. We represent the industry on EBF's business finance committee, influencing directives, sharing good practice and promoting the UK and the interests of SMEs across Europe. ?Feeding back on the feedback? will allow UK Finance to share our perspective. There is no question quality and timely feedback upon decline is critical. Not every business application can - or should - be successful, so it is important when this is the case a business understands why and what else they can consider. In the view of Professor Griggs, the European Commission now sees the UK as a country of best practice.

I look forward to the opportunity of sharing this with European colleagues as we look back on the anniversary.