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Business Money Magazine |
Research from Santander Corporate Banking revealed that one in three (32%) SMEs are now using two or more banks to provide services for their business – and the trend for multi-banking is rising with one in seven (14%) increasing the number of banking partners they work with in the past three years. More than half (51%) of the firms which have multiple banking relationships say they have moved because of the need to spread risk in case of bank failures following the government banking bailouts. In addition, 44% say they’ve changed to having multiple banking relationships in order to take advantage of more competitive interest rates, while 43% are shopping around because their main bank does not offer the right products for their business. Steve Pateman, head of Santander Corporate Banking, said: “Businesses have traditionally had one banking partner which has acted as depositor, creditor and guarantor. However, we are increasingly finding that this role has changed and become more fragmented as the overall level of service offered by many banks has become less flexible in meeting the needs of their corporate and commercial customers.” Steve added: “I believe that multi-banking approach will continue to become more common as businesses seek to diversify their risk from a sole provider. Certainly the significant increase we have seen in the number of SMEs approaching Multi-banking is more common amongst larger companies with over half (53%) of companies with an annual turnover of more than £1m having more than one banking provider. This compares to around one quarter (26%) of companies with a turnover of less than £1m. Other Business Money News
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