Question to the Department for Business and Trade:

To ask His Majesty's Government what assessment they have made of the impact of trade finance regulations on small businesses.

An area of regulation that impacts the availability of trade finance to small business is the implementation of Basel 3.1 standards.

The Prudential Regulation Authority (PRA) is responsible for setting capital requirements for UK credit institutions, such as banks and building societies, including those for trade finance-related activities. The PRA is currently implementing the final set of international banking reforms designed in response to the 2008 global financial crisis, known as Basel 3.1. The PRA's final Basel 3.1 proposals for trade finance tailor the Basel 3.1 standards to maintain capital requirements for the most material trade finance related activities. The PRA made this adjustment to its original proposals in light of the evidence provided by the International Chamber of Commerce which demonstrated that the current treatment was more appropriate.

In addition to regulatory reform, the Government is supporting small businesses to export by increasing UK Export Finance's capacity by £20bn to £80bn, allowing them to access government-backed finance and support to grow their presence both domestically and overseas.