UK Finance responds to the Budget 2021

Responding to the Chancellor's Budget delivered this afternoon, David Postings, Chief Executive of UK Finance, said:  

The Chancellor has set out a bold plan to support the economy in today's Budget. The banking and finance industry has taken unprecedented action over the last year to support businesses and customers, and we will continue to work closely with the Government to help the nation get back on its feet. This is a well constructed Budget that positions the UK as an open and internationally competitive place to do business and we welcome the measures set out by the Chancellor to achieve this vision.

Further comments below all attributable to David Postings, Chief Executive of UK Finance. 

On support for businesses 

The UK's banking and finance industry remains committed to helping businesses of all sizes through the crisis and has already delivered an unprecedented level of support to firms. This includes nearly £73 billion worth of finance provided through the Government-backed loan schemes to almost 1.6 million businesses, as well as a range of additional measures, including overdraft extensions and capital repayment holidays. With the current Government-backed schemes coming to a close, we welcome the announcement of the new Recovery Loan Scheme to help businesses continue to rebuild and will be working closely with the Government and lenders on delivering it. 

?As focus now turns to economic recovery we know that many firms are still facing high levels of uncertainty and the industry will continue supporting businesses through the next phase of the pandemic. 

On Stamp Duty 

We welcome the certainty an extension to the Stamp Duty holiday and a phased approach to its ending brings for buyers and sellers. This will help prevent a cliff edge, reduce the risk of house sales collapsing and will prove beneficial for all parties involved in the housing market.

On the Mortgage Guarantee Scheme  

The banking and finance industry supports innovation in the mortgage market, particularly measures which enable borrowers to realise their dream of home ownership, through lower deposits.  

?We look forward to working with the Government and lenders on helping to implement the scheme which will help many more people get onto the property ladder.  

On taxation 

The banking and finance industry is committed to continuing to work with the Government to help the nation's finances recover from the impact of the pandemic.

?As the UK looks to maximise opportunities for inward investment and growth, we need a taxation system that ensures the UK continues to be an attractive place to do business and enables financial services to support economic recovery. We welcome the Chancellor's announcement that the bank surcharge will be reviewed, and would encourage HM Treasury to consider the banking sector's total tax rate as part of this work to help ensure that the UK is more competitive internationally.  

On the contactless limit 

UK Finance welcomes the flexibility to increase the contactless limit to £100. This is a great move for customers and will allow them to use contactless to pay for higher value transactions like their weekly shop or filling up their car with fuel.  

"This could not have been achieved whilst still in the EU so is a true Brexit dividend. We will work closely with the payments sector and retailers ahead of increasing the limit later this year.

Notes to editor

<p>UK Finance is the collective voice for the banking and finance industry. Representing more than 250 firms across the industry, we act to enhance competitiveness, support customers and facilitate innovation. </p>
<p><strong>Background for the Mortgage Guarantee Scheme:</strong> </p>
<p>Firms have a duty to lend responsibly and consider the affordability of the mortgage in the long term, helping customers to avoid the risks associated with negative equity.</p>
<p>The banking and finance industry has put in place a clear plan to help Britain through:</p>
<ul><li>2.75 million <a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.u… payment deferrals</a></li>
<li>27 million <a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.u… overdrafts offered</a>, 1.18 million payment deferrals on credit cards and more than 828,000 payment deferrals on personal loans</li>
<li>Almost <a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.u…;£73 billion of lending</a> to nearly 1.6 million businesses through government Covid-19 lending schemes</li>
<li>Protecting customers from <a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.u… and fraud</a></li>
<li>Higher limit for<a href="https://eur01.safelinks.protection.outlook.com/?url=https%3A%2F%2F74n5c…; contactless payments</a></li>
</ul>