FCA Review on SME Access to Finance in 2026

Table of Contents

The FCA review found no evidence that its regulation

  • According to the Financial Conduct Authority (FCA), its regulation is not a major barrier to SME access to finance.
  • The FCA said many problems sit in wider market, information and capability gaps—not just rules.
  • The FCA highlighted microbusinesses as facing the greatest challenges and being less likely to use external finance.
  • The FCA pointed to Open Finance as one of its next steps to reduce friction and improve outcomes.

What did the FCA review reveal about SME access to finance?

An FCA review concluded it found no evidence that FCA regulation is a major barrier to small and medium-sized enterprises (SMEs) accessing finance, according to an FCA statement reported by Open Banking Expo on 18 September 2026.

That finding is framed as an evidence-based assessment of regulation’s role—not a claim that SMEs face no barriers to finance.

That finding doesn’t mean the market is working perfectly. Graeme Reynolds, the FCA’s director of competition, said: “Our regulation is not a major obstacle – that does not mean the system works as well as it could,” according to the FCA.

Instead, the FCA said the most persistent obstacles are often “wider market, information and capability challenges.” In practice, that points to frictions that happen before a lender even makes a credit decision—such as whether a business knows what products exist, can navigate the process, and can present information in a way that lenders can use efficiently.

The FCA also positioned its review as complementary to broader government and regulatory work to improve access to finance for smaller businesses, according to the FCA statement carried by Open Banking Expo.

How do microbusinesses differ in their use of external finance?

The FCA singled out microbusinesses as the segment where challenges are “often greatest,” according to the FCA statement reported by Open Banking Expo. The regulator also noted that microbusinesses make up 95.5% of all SMEs, and are less likely to use external finance.

That combination matters: if most SMEs are microbusinesses, then even modest barriers—time, paperwork, uncertainty—can translate into a large aggregate impact on business investment and growth.

The FCA highlighted several issues that can disproportionately affect microbusinesses, including limited awareness of finance options and complex application processes, according to the FCA. Microbusiness owners frequently wear multiple hats, so the “cost” of applying—time, documentation, follow-ups—can be a bigger deterrent than for larger SMEs with finance staff.

The FCA also pointed to difficulties accessing products suited to businesses with limited collateral or largely intangible assets, according to the FCA statement. That is particularly relevant for modern microbusinesses whose value may sit in software, data, contracts, or brand—assets that can be harder to underwrite using traditional approaches.

What challenges do SMEs face in accessing finance?

The FCA’s review emphasized that barriers are not limited to regulation; they often arise from how the market operates and how information flows between SMEs and finance providers, according to the FCA statement reported by Open Banking Expo.

Among the specific challenges the FCA highlighted:

  • Limited awareness of finance options, according to the FCA. If a business only considers a narrow set of products—or doesn’t know what it may qualify for—it may not apply at all, or may apply to an ill-fitting product and be rejected.
  • Complex application processes, according to the FCA. Complexity can include extensive forms, repeated requests for similar information, and unclear requirements.
  • Duplicated checks, according to the FCA. Repetition across providers can create friction, especially when SMEs shop around or need funding quickly.
  • Difficulty accessing products suited to limited collateral or intangible assets, according to the FCA. This can affect firms whose balance sheets don’t match traditional secured-lending models.

Taken together, these issues describe a system where the “plumbing” of applications and verification can be as important as the availability of capital—particularly for smaller firms and microbusinesses, which the FCA said face the greatest challenges.

What steps is the FCA taking to improve SME access to finance?

The FCA said it is focusing its next steps in three areas “to help reduce friction,” as part of its commitment to supporting growth, according to the FCA statement reported by Open Banking Expo.

Graeme Reynolds framed the objective in practical terms: “Small businesses need to be able to access the finance they need at the right time to start up, grow and invest,” according to the FCA.

He added that the FCA is focusing on where it can make “a practical difference” by:

  1. Reducing unnecessary friction, according to the FCA. This aligns with the review’s emphasis on complex processes and duplicated checks.
  2. Supporting a more proportionate regulatory framework, according to the FCA. The regulator’s message is that rules should fit the risks and realities of SME finance, rather than imposing avoidable burdens.
  3. Helping unlock the benefits of Open Finance, according to the FCA. This signals a technology-and-data pathway to improve how SMEs share information with providers—potentially reducing repetition and speeding decisions.

How is the FCA addressing issues outside its regulatory remit?

The FCA explicitly acknowledged that some issues raised by stakeholders fall outside the FCA’s remit, according to the FCA statement reported by Open Banking Expo. The regulator cited alternative lending as an example of an area where concerns may not be fully addressable through FCA action alone, according to the FCA.

In those cases, the FCA said it has shared findings with relevant government departments and bodies best placed to address them, according to the FCA statement.

This matters because SME finance is shaped by multiple forces: regulation, competition, information standards, and the broader policy environment. The FCA’s approach—at least as described in its statement—is to avoid over-claiming what it can fix through regulation, while still ensuring that evidence and stakeholder feedback reaches the institutions that can act.

What role does Open Finance play in supporting SMEs?

The FCA positioned Open Finance as one of the key next steps to support SME access to finance, according to the FCA statement reported by Open Banking Expo.

Open Finance roadmap context (2026–2030)

The FCA published an Open Finance Roadmap in April 2026, setting out a path to extend secure, consent-based data sharing beyond open banking toward broader financial products by 2030, with SME lending identified as a high-impact early use case in that roadmap. In Graeme Reynolds’ words, the FCA aims to “help unlock the benefits of Open Finance.”

While the FCA statement does not enumerate technical design details, it links Open Finance to the practical goal of reducing friction—an important connection given the review’s emphasis on duplicated checks and complex applications.

Open Finance, as referenced by the FCA, sits in a broader direction of travel: extending secure, permissioned data sharing beyond traditional open banking use cases so that financial information can move more efficiently—when the customer consents—between institutions and service providers.

The FCA has also explored Open Finance use cases through TechSprints, including work focused on SME finance and mortgages, using test environments such as synthetic data in published TechSprint materials.

In the SME context described by the FCA, the promise is straightforward: if businesses can share relevant financial information more easily, lenders and other providers may be able to reduce repetitive verification and make decisions faster, while SMEs spend less time re-entering the same data.

The FCA also pointed readers to related work on an Open Finance roadmap, according to Open Banking Expo’s coverage.

What is the significance of the FCA’s partnership with Open Banking Expo UK & Europe 2026?

The FCA is listed as an Event Partner of Open Banking Expo UK & Europe 2026, taking place 13–14 October at the Business Design Centre in London, according to Open Banking Expo.

In practical terms, this partnership signals that the FCA is engaging publicly with the open banking and open finance ecosystem at a moment when it is explicitly citing Open Finance as part of its next steps on SME access to finance, according to the FCA statement reported by Open Banking Expo.

Events like Open Banking Expo convene banks, fintechs, infrastructure providers, and policymakers—exactly the mix of stakeholders implicated by the FCA’s diagnosis of “market, information and capability” challenges, according to the FCA. If the barriers are partly about information flows, duplicated checks, and process complexity, then cross-industry coordination becomes a material part of the solution.

The FCA’s presence also reinforces that this is not framed as a niche innovation topic: the regulator is tying Open Finance to growth and to the day-to-day ability of small businesses to access funding “at the right time,” according to Graeme Reynolds in the FCA statement.

FCA Open Finance and SME Access to Finance: A Path Forward

Understanding the Current Landscape

The FCA’s 2026 review draws a clear boundary around what it believes is—and is not—driving SME finance outcomes. It found no evidence that FCA regulation is a major barrier, but it also stressed that the system can work better.

The regulator’s diagnosis focuses on frictions that are operational and informational: limited awareness of options, complex applications, duplicated checks, and difficulties for firms with limited collateral or intangible assets, according to the FCA. It also highlights that microbusinesses—95.5% of SMEs—often face the greatest challenges and are less likely to use external finance, according to the FCA.

Just as importantly, the FCA described a two-track response: act where it can (reducing friction, proportionate regulation, Open Finance) and escalate what it can’t directly fix by sharing findings with the relevant departments and bodies, according to the FCA.

The Role of Open Finance in SME Growth

The FCA’s emphasis on Open Finance is best understood as a mechanism to make SME finance work more smoothly, not as a slogan. The regulator explicitly linked its next steps to “unlock[ing] the benefits of Open Finance,” according to Graeme Reynolds in the FCA statement reported by Open Banking Expo.

If the biggest pain points include duplicated checks and complex processes, then Open Finance’s core idea—consent-based sharing of relevant financial data—maps directly onto the FCA’s stated goal of reducing unnecessary friction, according to the FCA.

The direction of travel is also collaborative. The FCA said its review complements wider government and regulatory work, and it is engaging with the ecosystem as an Event Partner of Open Banking Expo UK & Europe 2026 in London, according to Open Banking Expo. The underlying message is that improving SME access to finance is not just about changing rules; it is about improving how the market functions—especially for the smallest firms that feel the friction first.

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