UK based retail bank TSB has decided to create a business marketplace that will enable small businesses to compare financing options from multiple lenders.
About 90% of small business banking is dominated by the big lenders most of which have a complicated and time consuming application process.
To allow these small businesses to review the finance market quickly, TSB will partner with Funding Options to deliver the business marketplace by the month of May.
This marketplace will open up variety of loans and types of finance for these small businesses.
Besides applying for a loan at TSB, the marketplace will enable them to shop around and compare options provided by other lenders.
TSB director of commercial banking Richard Davies said: “There is a huge funding gap for small businesses that exists in the UK today and it is stunting the growth of these firms and stopping them from investing to grow.
“Bringing more competition to UK banking is in our DNA, and Business Marketplace will allow a small business owner to easily compare what’s available in the market.
“We believe customers must be given choice, and that competition will drive us to create the best solutions for customers. This will help unlock the true potential of small businesses and address the stagnation of productivity in the UK.”
Funding Options chief executive Conrad Ford said: “The future for banks is to offer not just their own products to customers, but also the best the market has to offer.
“This is especially true in SME finance, where not every small business is right for bank lending, yet a thriving market of alternative lenders stands ready to deliver much-needed funding.”
Currently, TSB is also working on a multi-million investment programme to develop new banking services for small businesses across the UK.