Its latest review found no evidence that FCA regulation is itself a major obstacle to SME funding. However, it identified several wider problems that can make finding and applying for suitable business finance more difficult than necessary.

These include limited awareness of available finance options, complicated application processes, repeated checks and difficulty finding products suited to businesses with limited physical collateral or predominantly intangible assets.

## Why access to finance remains challenging

Smaller businesses often need external finance to invest in equipment, manage cash flow, recruit employees or pursue new opportunities.

Yet the funding market can be difficult to navigate. Different lenders may request different information, offer different products and apply their own eligibility requirements.

The FCA found that these challenges can be particularly significant for microbusinesses. It also noted that smaller firms are less likely to use external finance, potentially limiting their ability to invest and grow.

The review concentrated mainly on regulated business lending of £25,000 or less to sole traders and small partnerships. Much lending to limited companies, facilities above £25,000 and parts of the alternative finance market sit outside this particular regulatory perimeter.

## What is the FCA proposing?

The FCA has identified three areas where it believes practical improvements could reduce unnecessary friction.

### A more proportionate regulatory system

The Treasury is reforming the Consumer Credit Act with the aim of creating a more modern, outcomes-based framework while retaining important protections.

Following that legislative reform, the FCA is expected to consult on the future regulatory framework. This could help address concerns surrounding the complexity and cost of some regulated SME lending.

### Greater use of open finance

Open finance could allow businesses to share relevant financial information securely with finance providers.

In time, this may help lenders assess applications using richer and more accurate business data. It could also reduce the need for businesses to collect and submit the same information repeatedly.

The FCA has identified SME lending as one of its priority use cases when developing proposals for the UK’s first open-finance scheme.

### Reducing duplicated checks

The FCA is also monitoring industry work exploring whether digital verification could reduce repetition during customer checks.

A more streamlined verification process could make applications quicker and less frustrating while maintaining the financial-crime controls required of finance providers.

## What could this mean for UK businesses?

These measures will not remove lender eligibility requirements or guarantee that an application will be accepted.

Every lender will continue to assess applications according to its own criteria, including affordability, business performance, credit history and the intended use of the funding.

However, clearer information, improved data sharing and less duplication could make it easier for businesses to understand their options and prepare stronger applications.

The proposals could also help finance providers assess businesses whose value is based on intellectual property, technology, contracts or other intangible assets rather than traditional physical collateral.

## Preparing for a business-finance application

While the proposed changes develop, businesses can improve their readiness by keeping their financial information accurate and current.

This may include:

– Recent business bank statements
– Filed accounts or management accounts
– Cash-flow forecasts
– Details of existing financial commitments
– A clear explanation of the funding requirement
– Evidence showing how the finance will support the business

The exact information required will depend on the finance product, lender and individual circumstances.

## Finding a suitable finance option

The business-finance market includes term loans, asset finance, invoice finance, revolving credit facilities and other specialist products.

The most suitable option will depend on factors including the amount required, the intended use of the funds, the financial position of the business and its preferred repayment structure.

MoneyWow helps UK businesses explore finance through a panel of finance providers. We act as a broker and introducer, not a lender, and all applications remain subject to lender assessment, eligibility and approval.

The FCA’s work represents a positive move towards a simpler and more accessible SME-finance market. For business owners, understanding the available options and preparing the right information will remain an important part of securing suitable funding.

**Looking for business finance?**

Tell MoneyWow what your business needs and we’ll help you explore suitable options from our panel of UK finance providers.

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*MoneyWow is a finance broker and introducer, not a lender. Finance is subject to application, status, lender criteria and approval. Terms and conditions apply.*

**Source:** Financial Conduct Authority, “FCA sets out steps to support small businesses’ access to finance”, published 17 September 2026.

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The British Business Bank has announced a £6.5 billion uplift to the scheme, designed to increase the amount of lending available to smaller businesses across the UK over the next four years.

What Is the Growth Guarantee Scheme?

The Growth Guarantee Scheme is designed to support access to finance for smaller UK businesses through participating lenders.

The latest expansion is expected to help around 33,000 businesses access finance to support investment and growth.

The scheme has already delivered billions of pounds of funding through accredited finance providers, supporting businesses across the UK.

Greater Flexibility for Growing Businesses

As part of the expansion, some facility terms under the scheme will be extended from six years to as long as ten years.

Business turnover eligibility is also set to increase from £45 million to £54 million, potentially allowing a wider range of growing businesses to access finance supported by the scheme.

The changes are intended to give viable businesses greater opportunities to secure funding for investment, expansion and long-term growth.

Why Access to Finance Matters

For many businesses, having access to suitable finance can make it easier to invest without placing unnecessary pressure on existing cash reserves.

Funding can be used for a wide range of purposes including purchasing equipment, investing in vehicles, increasing stock, supporting working capital or funding expansion plans.

The right finance structure will depend on the individual business, the purpose of the funding and the amount required.

Exploring Business Finance Options

At MoneyWow, we help UK businesses explore a range of finance options from our panel of lenders.

Whether you’re looking for working capital, equipment finance, vehicle finance or funding to support your next stage of growth, we’ll help you explore suitable options based on your business requirements.

Looking for business finance? Explore your options with MoneyWow today.

Source: British Business Bank, July 2026.

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The British Business Bank has increased its funding facility with Compass Business Finance to up to £45 million, providing additional capacity to support smaller businesses looking to invest in equipment, technology and other business assets.

More Funding for UK SMEs

The latest agreement builds on an existing relationship between the British Business Bank and Compass Business Finance.

An initial £15 million commitment was made in 2020 before being increased to £30 million in 2022. The facility has now been extended again to as much as £45 million.

Compass provides a range of commercial finance facilities including finance leases, hire purchase and business loans to smaller businesses across the UK.

Supporting Investment in Equipment and Technology

Access to finance can play an important role when businesses need to invest without using significant amounts of their existing working capital.

Asset finance, for example, can allow businesses to spread the cost of vehicles, machinery, equipment and technology over an agreed period rather than funding the entire purchase upfront.

For growing businesses, this can help preserve cash for other areas such as staffing, stock, marketing and day-to-day operating costs.

Why Access to Business Finance Matters

The British Business Bank says the expanded facility is intended to strengthen the flow of finance to smaller businesses and support investment, growth and resilience.

The announcement is another indication of the continued focus on improving access to funding for viable UK SMEs.

Different businesses will have different funding requirements, and the most suitable type of finance will depend on factors including the purpose of the funding, the amount required and the financial position of the business.

Exploring Your Business Finance Options

At MoneyWow, we help UK businesses explore a range of finance options from our panel of lenders.

Whether you’re looking to purchase machinery, finance new equipment, invest in technology or raise capital for your next stage of growth, we’ll help you explore suitable funding options based on your requirements.

Looking to invest in your business? Explore your finance options with MoneyWow today.

Source: British Business Bank, 1 September 2026.

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According to the latest Bank of England Money and Credit data, UK non-financial businesses borrowed a net £1.8 billion from banks and building societies during July 2026. Small and medium-sized businesses accounted for approximately £0.8 billion of that borrowing, up from £0.7 billion in June.

SMEs Continue to Access Finance

The latest figures suggest that demand for business funding remains active across the UK.

For many businesses, external finance can provide the additional capital needed to purchase equipment, invest in vehicles, increase stock levels, improve cash flow or fund expansion without placing unnecessary pressure on existing working capital.

Annual SME borrowing growth remained at 4.1% in July, according to the Bank of England.

The Cost of Borrowing Has Increased

While businesses continue to borrow, funding costs remain an important consideration.

The effective interest rate on new SME bank loans increased from 6.36% in June to 6.61% in July. The rate on new loans across UK non-financial businesses increased to 5.62%.

That makes comparing different finance structures particularly important. The lowest headline rate isn’t necessarily the only consideration; repayment structure, term, security requirements and flexibility can all affect whether a particular facility is suitable for a business.

What Does This Mean for UK Businesses?

Businesses considering investment don’t necessarily need to rely entirely on existing cash reserves.

Depending on the circumstances, funding options can include business loans, asset finance, invoice finance, working capital facilities, vehicle finance and other specialist commercial finance products.

Different lenders have different criteria and appetites for lending, which is one reason businesses may benefit from exploring more than one funding option.

Finding the Right Business Finance

At MoneyWow, we help UK businesses explore finance options from our panel of lenders.

Whether you’re looking to invest in equipment, strengthen cash flow, purchase vehicles or fund the next stage of your business growth, we’ll help you explore suitable funding options based on your requirements.

Looking for business finance? Explore your options with MoneyWow today.

Source: Bank of England, Money and Credit – July 2026.

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