Asked by: Adam Afriyie (Conservative - Windsor)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has made an assessment of the viability of using more FinTech platforms to distribute Government-backed financial loans and support packages alongside established high-street banks and lenders.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The UK is home to a world-leading Fintech sector and an impressive amount of talent and expertise in this area. The government knows that Fintech firms play an important role in the lending market, especially for smaller businesses.
I am grateful for the way the sector has responded to the current crisis by identifying opportunities where technology may support the Government’s response.
The British Business Bank (BBB) has so far accredited 28 Bounce Back Loan Scheme (BBLS) lenders, including several non-banks and alternative lenders. In addition, the BBB has in excess of 100 accredited lenders for the Coronavirus Business Interruption Loan Scheme (CBILS) and this includes several UK Fintechs.
Asked by: Karen Bradley (Conservative - Staffordshire Moorlands)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what assessment his Department has made of the effect of the covid-19 pandemic on the UK challenger banks sector; and if he will make a statement.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The German merchant acquirer Wirecard AG entered administration in June. It has a UK subsidiary, Wirecard UK, which is authorised and regulated by the Financial Conduct Authority (FCA). The FCA ensures that payments firms make suitable safeguarding arrangements in compliance with the regulatory requirements as a condition of firms receiving FCA authorisation, protecting client money.
Shortly after the entry into administration of Wirecard AG, the FCA temporarily blocked the distribution of funds from the UK subsidiary, Wirecard UK, to ensure client monies were properly safeguarded. Wirecard UK is being wound down but the business will continue to trade while alternative arrangements are being made with its card providers.
Payments in the UK have seen rapid change over recent years, including the growth of firms like Wirecard UK. These changes offer exciting opportunities for UK businesses and consumers, with many making payments faster and cheaper. However, and as will always be the case with a rapidly changing technological landscape, they also present new challenges and risks.
Given the pace of change, a HM Treasury led review of the payments landscape was announced in June 2019. A Call for Evidence is the first stage in this review, open until 20 October.
The Government recognises the crucial role of challenger banks in providing customers with more choice and is committed to maintaining competition in financial services. We recognise the COVID-19 crisis has been difficult for many firms, including challenger banks, and we continue to engage regularly with the sector to understand how firms are being impacted.
Asked by: Karen Bradley (Conservative - Staffordshire Moorlands)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, with reference to the report entitled Coronavirus Survey Report, published by the APPG on Challenger Banks and Building Societies, if he will make an assessment of the potential merits of the recommendations in that report; and if he will make a statement.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
The Government recognises the crucial role of challenger banks and building societies in providing customers with more choice on the high street and is committed to maintaining competition in financial services.
HM Treasury officials have consistently engaged with regulators and representatives from the building society and challenger bank sectors on issues related to the COVID-19 pandemic. I have regularly engaged with representatives from the building society sector through the Consumer Finance Forum and Financial Inclusion Policy Forum, which are bringing financial services and consumer group representatives together to discuss how to best support people through this period.
The Government recognises that the COVID-19 crisis has been difficult for many organisations, including challenger banks and building societies.
That is why in April 2020, I wrote to thank frontline staff for their efforts to continue to provide essential services to their members.
We have considered the Coronavirus Survey Report produced by the APPG on Challenger Banks and Building Societies and thank the APPG for taking the time to produce the report. The Government remains committed to ensuring that challenger institutions have an appropriate environment to grow and offer more robust competition to the established players. The government will continue working with the regulators to ensure the UK has a highly competitive banking sector, working in the interests of all consumers and businesses right across the country. We will continue to work closely with challenger institutions and building societies as we consider the next steps in our economic recovery
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what recent discussions he has had with representatives of the banking sector operating the coronavirus Bounce Back Loan on potential difficulties customers have experienced in accessing their accounts upon applying for that financial support.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Treasury officials are in regular contact with the banking sector to solicit their feedback on BBLS, as well as all the other supporting measures implemented in response to the Covid-19 pandemic. As of 20th September, over 1.2 million facilities have been approved through BBLS representing a value of more than £38bn.
Decisions about what products are offered to specific businesses remain commercial decisions for banks and building societies, in which it would be inappropriate for the Government to intervene.
The Government believes that any dispute arising between banks and their customers is usually best resolved by the parties involved. If a customer wishes to pursue a complaint, their first recourse is through the bank's official customer complaints procedure. The Financial Conduct Authority requires banks to properly investigate all complaints and, through ongoing supervision, it continues to monitor the banks' complaint handling processes.
If a customer is not satisfied with their bank's response to their complaint, then they may wish to consider an approach to the Financial Ombudsman Service (FOS). The FOS provides a free, independent dispute resolution service for bank customers, including eligible small businesses.
Asked by: Tanmanjeet Singh Dhesi (Labour - Slough)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has received representations on banks closing customer accounts after applying for the coronavirus Bounce Back Loan scheme.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
Treasury officials are in regular contact with the banking sector to solicit their feedback on BBLS, as well as all the other supporting measures implemented in response to the Covid-19 pandemic. As of 20th September, over 1.2 million facilities have been approved through BBLS representing a value of more than £38bn.
Decisions about what products are offered to specific businesses remain commercial decisions for banks and building societies, in which it would be inappropriate for the Government to intervene.
The Government believes that any dispute arising between banks and their customers is usually best resolved by the parties involved. If a customer wishes to pursue a complaint, their first recourse is through the bank's official customer complaints procedure. The Financial Conduct Authority requires banks to properly investigate all complaints and, through ongoing supervision, it continues to monitor the banks' complaint handling processes.
If a customer is not satisfied with their bank's response to their complaint, then they may wish to consider an approach to the Financial Ombudsman Service (FOS). The FOS provides a free, independent dispute resolution service for bank customers, including eligible small businesses.
Asked by: Baroness Kennedy of Cradley (Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty's Government what assessment they have made of the support (1) banks, and (2) other financial institutions, are providing to businesses trading in the UK during the COVID-19 pandemic.
Answered by Lord Agnew of Oulton
To support businesses and relieve pressure on their finances and cashflow, the government launched three loan guarantee schemes to give banks and other lenders the confidence they need to lend to businesses: the Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS), and Bounce Back Loan Scheme (BBLS). As of 20 September, over £57bn has been approved under the three schemes. On the 24th September, the Chancellor announced an extension to the deadline for new loan applications for CBILS, CLBILS, BBLS and the Future Fund to 30 November.
The Government also recognise the vital role that non-banks and challenger banks play in the provision of credit to SMEs. We are grateful for the way the sector has responded to the current crisis, and we remain committed to promoting competition and widening the funding options available to UK businesses.
Asked by: Ronnie Cowan (Scottish National Party - Inverclyde)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps his Department is taking to ensure people have access to banks and cash withdrawals during the covid-19 outbreak.
Answered by John Glen - Paymaster General and Minister for the Cabinet Office
In response to Covid-19, banks, building societies, credit unions and Post Offices are working with the Treasury and the financial regulators to maintain access to their services, including access to cash, while balancing the needs of their customers with the safety and welfare of staff. The vast majority of branches are open, though many are open for reduced hours. The Financial Conduct Authority has issued guidance to regulated firms, including on provision to allow a trusted third party to make payments on behalf of vulnerable customers who may be shielding or self-isolating.
Asked by: Dan Poulter (Conservative - Central Suffolk and North Ipswich)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, what plans her Department has to provide further support to food banks in response to a potential increase in unemployment as the Coronavirus Job Retention Scheme ends.
Answered by Will Quince
The Department for Work and Pensions has no plans to provide support to food banks which are run by independent charitable organisations. However, the Department is committed to providing a strong welfare safety net of financial support for those that need it. In addition to the £5 billion increase in benefit rates from April 2020, we have injected more than £9 billion into the welfare system in response to Covid-19, increasing Universal Credit and Working Tax Credit by up to £1,040 for this financial year, benefiting over four million households. We have also increased Local Housing Allowance rates - putting an average of £600 into people’s pockets.
The Department also works in partnership with a variety of stakeholders as well as through Jobcentre Plus offices, to provide factual information on the range of benefits available, including Universal Credit (which is also an in-work benefit). When somebody has an enquiry or change in their circumstances, we actively encourage them to establish their eligibility and start an application as soon as it is right for them. No one has to wait five weeks for Universal Credit as new claim advances are available. This information is promoted through social media and advertising which directs people to the Understanding Universal Credit website for further information.
Asked by: Lord Pendry (Labour - Life peer)
Question to the Department for Digital, Culture, Media & Sport:
To ask Her Majesty's Government, further to reports of financial difficulties faced by local football and other sports clubs as a result of the COVID-19 pandemic, what assessment they have made of the role that sports clubs play in the community life of their respective towns; and what steps they are taking to provide financial assistance to clubs as a matter of urgency.
Answered by Baroness Barran - Parliamentary Under-Secretary (Department for Education)
Sport and physical activity can help build stronger communities by bringing people together. Sports clubs and volunteers have played a huge role in supporting communities through coronavirus – re-purposing themselves to provide delivery services, food banks and volunteer support.
Sport England have announced a £195 million package of support to help community clubs through this crisis. It recently boosted its Community Emergency Fund by a further £15 million to meet the demand, taking the total package up to £210 million.
Football clubs can also apply to the Football Foundation’s “Club Preparation Fund” for a grant to make the necessary changes and modifications to allow them to reopen.
The government is continuing to work closely with the sector to understand the issues they face and discuss how we can support them further.
Asked by: Simon Baynes (Conservative - Clwyd South)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what support he is providing to small builders in North Wales.
Answered by Nadhim Zahawi
Whilst policy relating to construction is a devolved matter, my Rt. Hon. Friend Mr Chancellor of the Exchequer has announced a £330 billion support package of Government-backed and guaranteed loans so as to help businesses to access finance, including those in Wales.
Measures include the Coronavirus Business Interruption Loan Scheme (CBILS), which enables small and medium-sized enterprises, with a turnover of up to £45 million, to access vital financial support. This is available to businesses in Wales via high street banks and the Development Bank of Wales. The Chancellor has extended the CBILS so that all viable businesses affected by COVID-19, and not just those unable to secure regular commercial financing, will now be eligible should they need finance to keep operating during this difficult time. In addition, we announced the Bounce Back Loans Scheme, which provides loans of up to £50,000 to benefit small businesses with a 100% Government-backed guarantee for lenders.
The Welsh Government has announced a new £500 million Welsh fund which will support firms of all sizes, including social enterprises.