UK Finance welcomes the Financial Conduct Authority’s call for input on understanding and improving SMEs’ experience of accessing finance.

Small and medium‑sized enterprises (SMEs) play a vital role in the UK economy. The UK’s SME finance market is diverse, competitive and resilient, with lenders demonstrating strong appetite and capacity to support viable businesses. However, some SMEs continue to face challenges when accessing finance.

Our submission draws on evidence from across UK Finance’s membership and highlights both supply‑side and demand‑side factors affecting SME access to finance.

Supply‑side considerations include:

• Increasing regulatory complexity and duplication across prudential, conduct and reporting requirements
• Challenges arising from the current Consumer Credit Act framework when applied to business lending
• Friction created by data‑sharing arrangements and compliance processes

Demand‑side challenges include:

• Economic uncertainty and low confidence
• Limited financial capability and information gaps
• Barriers affecting micro‑businesses, underserved groups and asset‑light or IP‑intensive firms

Opportunities to improve access

UK Finance identifies opportunities to support better outcomes through more proportionate regulation, clearer distinctions between consumer and business lending, improved data‑sharing and stronger coordination across government, regulators and industry.

UK Finance looks forward to continuing engagement with the FCA.