Terms of reference for SME Finance inquiry

• Inquiry: SME Finance
• Treasury Committee

This inquiry will consider the state of the SME finance market under the following themes:

Funding options available to SMEs.

• The availability and uptake of different sources of funding for SMEs, including banks, peer-to-peer lenders and crowdfunding
• The level of competition in the SME lending market and the impact of recent regulatory initiatives
• Trends in SME finance and how potential changes to regulation and redress may affect the market
• Any sources of finance which SMEs will not consider or approach and why

The ability of SMEs to resolve disputes and access fair and reasonable compensation when they borrow money.

• The effectiveness of existing arrangements for dispute arbitration and settlement
• The merits of the Financial Conduct Authority's proposals for expanding SME access to the Financial Ombudsman Service
• The case for establishing a new “tribunal” body for settling SME banking disputes and the means by which such a body could be created
• The design, governance and operation of such a tribunal body, and the potential relationship between it, the Financial Ombudsman Service, and the Financial Conduct Authority
• The impact of additional avenues for redress on (i) the balance of power between SMEs and lenders; and (ii) the supply of, and demand for, credit

The regulation of SME lending.

• The level of protection currently afforded to SMEs when they borrow money
• The case for bringing lending to SMEs within the regulatory perimeter, including (i) the likely impact on the supply of, and demand for, credit; and (ii) lessons learned from past misconduct
• Other non-regulatory or quasi-regulatory options for policing SME lending, such as the establishment of industry codes and standards

Further information

• About Parliament: Select committees
• Visiting Parliament: Watch committees

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