Three times as many SMEs have been satisfied than dissatisfied with the COVID-19 support available from their bank or building society.
Today (24 November 2020) Pay.UK published research on the impact of COVID-19 on SME business banking – the research was conducted by YouGov research and was commissioned by the Current Account Switch Service.
Four in ten SMEs satisfied
Overall, four in ten SMEs (38%) were satisfied with the support they received from their business current account provider since the pandemic began.
This contrasts with one in ten SMEs (13%) who were dissatisfied.
Across the country, banks and building societies have been working hard in difficult circumstances to meet customer needs. Thanks to that work, small and medium-sized enterprises are more likely to say they are satisfied than dissatisfied with the support they received from their business account provider since the pandemic started. But lockdown has changed small business behaviour dramatically, in a way that points to significant changes to their banking needs both now and in future.Maha El Dimachki, Chief Payments Officer of Pay.UK, owner and operator of the Current Account Switch Service.
In general, more than half of SMEs (55%) are satisfied with their current business bank account, compared to 8% who are dissatisfied. However, inertia remains a problem as half of SMEs (50%) said they would not look to switch business accounts even if they were dissatisfied with their current bank or building society.
Why do SME’s switch their bank account?
When SMEs do look to switch, low or no charges for business banking remains the most important factor (47%) in selecting a new account. Advanced digital features (35%), good interest rates (34%), and a personal connection through a relationship manager (33%) also mattered.
The SME banking research commissioned by Pay.UK (operators of the Current Account Switching Service) also reveals that since the start of the pandemic, the proportion of SMEs using business current accounts has increased from 69% in February to 74% in September as firms are required to have a business account to receive access to the Government-backed lending schemes.
It’s encouraging to see many small businesses are generally satisfied with their business bank accounts. However, even when businesses are unhappy with their bank, some don’t consider switching as an option, despite the many benefits available. We’ll continue to raise awareness of the benefits of switching among small businesses to help them get the most from their bank accountMaha El Dimachki, Chief Payments Officer of Pay.UK, owner and operator of the Current Account Switch Service.
The research also shows the importance of branches to SMEs has declined over the seven months.
When asked in February, more than a fifth of SMEs (22%) said the availability of nearby bank branches was important when selecting their bank or building society, compared to 17% in September.
While branches are less important, digital banking use has increased for some SMEs. Several firms have started to use online banking for the first time as 15% of SMEs say they use mobile or online banking more often than before the social distancing measures were introduced.
Read Pay.UK’s report: The impact of COVID19 on SME business banking.