The SME Finance Taskforce has announced the development of an action plan that is focused on accelerating the UK economic growth. Following this announcement, the plan is expected to speed up lending and access to finance for 5.5 million small and medium-sized enterprises (SMEs), which employ 60% of the private-sector workforce, as well as deliver over 50% of the UK economic turnover.

The seven-point strategy is contained in the taskforce’s first report, ``Smart Data: improving SME lending to drive economic growth``. It was also formed by the Centre for Finance, Innovation & Technology (CFIT) and supported by an Open Banking Limited (OBL) secretariat, and it found that increasing access to high-quality data will allow SMEs to expand and receive the needed funding to develop and scale. More information on the announcement According to the official press release, lending to UK SMEs has fallen by 20% in real terms over the past decade.

The resulting funding gap was estimated to be more than GBP 22 billion, and it is expected to prevent SMEs from investing in their firms, improving productivity, and making an optimised contribution to the overall economy. In order to unlock the opportunity of increasing SMEs’ contribution and possibility to employment, GDP, and tax revenues, the taskforce has proposed seven key actions: prioritise the Digital information and Smart Data Bill, review and improve HM Treasury’s Bank Referral, and Commercial Credit Data Sharing (CCDS) Schemes, fund and support an SME “Smart Data Challenge``, unlock private-sector data by offering digital receipts from GMRC, as well as optimised access to tax data for approved organisations. In addition, it will also focus on accelerating the reform of Companies House, in particular standardisation and verification of Company Information, develop and consult on a proposal for an e-invoicing scheme for the UK in order to align with overseas markets, as well as enabling improved trust and understanding in using new alternatives specialists leaders.

Institutions that are involved in the CFIT-led taskforce include iwoca, Sage, OakNorth, Allica Bank, Experian, HSBC, Lloyds Banking Group, Mastercard, the Federation of Small Businesses (FSB), and Revolut, all aiming to ensure that the action plan has cross-industry support. They all are pledged to work in collaboration with the Government to grow the UK economy and contribute to the overall policy and legislative development. At the same time, the taskforce’s recommendations were built on a report that was published earlier this year by CFIT’s inaugural coalition on Open Finance.

The coalition had also demonstrated that Open Finance has the possibility to deliver more lending to the SMEs, with a pilot analysis also showing that over a quarter of SMEs who risked mission out on credit would be able to get access to finance with optimised data-sharing. .