The new rules which are about to make life easier for SMEs

Small firms should now find it easier to open or switch a business current account.

UK Finance said it has worked with business bank account providers to agree a basic set of information that each bank needs from new customers.

Stephen Pegge, managing director of commercial finance at the trade association, said: “Opening a business current account is an important step for any business and we want to help ensure that the process is as simple as possible.

"The new guide we’ve developed with the banks aims to make the process easier for businesses, saving valuable time and effort by ensuring that all the information required is available so they are prepared and ready before the initial meeting takes place. 

"We believe that this will, in turn, help to promote greater choice and competition in the business current account market.”

The online guide will apply to new or existing businesses who:

• Have a turnover of less than £6.5million per year.
• Have a straightforward and clearly-defined ownership structure.
• Are based and operate in the UK.

Checklist

Any small firm wanting to open or to switch a business current account can now search 'business account checklist’ on their chosen bank’s website to access the guide or visit the UK Finance website.

The Competition & Markets Authority (CMA) had identified that the account-opening process was a barrier to switching for some small and medium-d businesses in its investigation into the retail banking market.

To address this issue, UK Finance developed the guide. It not part of the application process, but is a checklist to help customers prepare themselves to open a business current account.

The guide is one of a series of initiatives set out by the CMA to increase the level of choice and competition in the current account market for small businesses and consumers.

Other remedies concern the development of an SME loan price and eligibility tool, overdraft alerts with grace periods and transaction history for customers.