Introduction

The UK’s 5.5 million small to medium-sized businesses (from sole traders to firms employing up to 50 people) are the backbone of the economy, accounting for around 99% of the business population. Together they employ around 16.4 million people and are responsible for turning over about £1.2 trillion each year.

Yet after two years of pandemic, cost-of-living challenges and increasing inflation, many SMEs are under pressure. There are 82,000 fewer businesses than in 2020, and those that remain face increasing running costs, difficulties accessing short and long-term finance, and administrative burdens.

This guide explains how open banking solutions can help address these challenges, including speedy access to cost-effective lending, ways to manage payments (in and out), accounting tools and finance links, and real-time insights into cash flow that can help improve business decision-making.

There are around 750,000 small to medium-sized enterprises (SMEs) using open banking products, many as part of their cloud accountancy packages. We hope this guide will help some of the remaining businesses and sole traders take advantage of open banking and benefit from the cost and time savings it can deliver.