Large banks don’t do a good job for small businesses. Their credit is as hard to underwrite as that of large corporations, yet they only want small and flexible working capital facilities not three-year and five-year standardized term loans that suit the banks.
Big banks are built to serve big companies.
Bank lobbyists will pile up data claiming to show the opposite.
Stephen Pegge, managing director of commercial finance at UK Finance, says: “The UK’s banking and finance industry is delivering an unprecedented level of support to businesses across the whole country to help them through these challenging times. Over 1.5 million businesses have been helped with government-guaranteed loans totalling over £68 billion.”
If you find a single UK SME that feels well served by a large UK bank, please let us know. Euromoney has not encountered one.
The only question is whether challengers like Iwoca and OakNorth can seize the opportunity and themselves scale up, as SoFi is seeking to in the US.
Storfund, a two-year old fintech founded by former colleagues at Barclays who saw a gaping hole in invoice discounting for merchants on e-commerce marketplaces, exemplifies the story in two ways.
Where
