Why the FCA’s Open Finance roadmap won’t fix SME finance if cash flow lags behind

The Financial Conduct Authority’s (FCA) Open Finance roadmap, introduced successful April 2026, is meant to beryllium a large measurement toward a much data-driven fiscal system. Building connected the foundations of Open Banking (OB), the inaugural aims to widen information sharing beyond existent accounts to a wider scope of fiscal products, including lending, savings and mortgages.
The premise is simple: allowing fiscal information to determination much freely tin accelerate decision-making for lenders, arsenic good arsenic the transportation of services. For businesses, this could amended their quality to unafraid finance, peculiarly for those that person struggled to entree recognition successful the past oregon those without an established borrowing history. On paper, the FCA’s roadmap stands to trim 1 of the industry’s long-standing barriers and promote fairer contention among players.

But for galore SMEs, the situation is maintaining accordant liquidity. The spread betwixt recognition support and the availability of usable funds remains the persistent issue. Businesses look fiscal pressures successful existent clip and, portion Open Finance whitethorn amended however lending decisions are made, the FCA has yet to code however rapidly funds scope merchants' accounts.

Approved concern does not construe to contiguous liquidity

The existent fiscal scenery highlights a disconnect successful the FCA’s Open Finance plans. While securing backing is simply a priority, the velocity astatine which businesses tin entree liquidity remains an issue.

A concern whitethorn beryllium expecting incoming funds yet inactive beryllium incapable to conscionable payroll, wage suppliers, oregon settee taxation liabilities connected time. The contented is not ever whether wealth volition beryllium paid into merchants’ accounts, but erstwhile it becomes disposable to screen day-to-day fiscal pressures.

Late payments aggravate this challenge. UK SMEs are owed tens of billions of pounds successful unpaid invoices and astir 90% of firms study having experienced precocious payments implicit the past year, with astir fractional reporting that delays are becoming much frequent. On average, payments get implicit 30 days past agreed terms, keeping captious moving superior locked distant for weeks beyond expectations.

The origin of precocious payments is besides shifting. What was erstwhile driven by inefficiency is present progressively structural. In galore cases, it reflects unit wrong proviso chains, wherever currency is either unavailable oregon deliberately held backmost elsewhere successful the network.

The effect goes beyond idiosyncratic firms. Across the wider economy, precocious payments outgo an estimated £11bn each twelvemonth and lend to thousands of concern closures. Smaller companies thin to consciousness the interaction most; with tighter currency reserves and little country to sorb delays, they are much exposed erstwhile payments bash not get connected time.