FCA finds defence SMEs face banking friction, not exclusion

The Financial Conduct Authority found that defence small-to-medium enterprises encounter delays and repeated information requests when accessing banking services, rather than being routinely excluded. Banks are willing to serve the sector but their processes are often disproportionate to specific risks. The FCA recommends that firms reduce onboarding friction while maintaining effective risk management, and that SMEs provide clear, timely information to streamline the process.