UK economy missing out on vital boost as SMEs stockpile £86bn of surplus cash in low or zero-interest current accounts

Industry News | 22/01/20

The UK economy is missing out on a vital boost as new research reveals small-and-medium sized businesses (SME) are sitting on £86 billion of dormant cash in current accounts paying little or no interest. Shawbrook Bank’s inaugural SME Savings Monitor reveals this is also causing smaller firms to miss out on billions of pounds in interest. The research found that SMEs, which make up 99.9% of the UK’s 5.9 million firms, need quick access to 31% of their total cash reserves to cover the cost of day-to-day operations. However, SMEs are actually holding an average of 57% of their total capital in current or instant-access accounts, rather than fixed-term deals that typically pay higher rates of interest.

Source: Enterprise Talk