ISME says banks 'ripping off' small business

The Irish Small and Medium Enterprises Association (ISME) today accused banks of "ripping off" small business.

The small firms lobby group said the banks had been "engaging in underhand practices that have cost businesses millions".

ISME claimed evidence recently forwarded to the Joint Oireachtas Committee for Finance and Public Service provided proof of this.

Representatives of the main banks appeared before the Dáilcommittee on Wednesday following widespread allegations that the banks were not passing on interest rate cuts to their customers.

Following the meeting, the Irish Financial Services Regulatory Authority said it would undertake a detailed study into how banks have managed the cuts in the European Central Bank interest rates.

ISME says: "Figures recently released by the European Central Bank confirm that loan rates charged to small businesses are much higher in Ireland, in comparison to the rest of Europe".

"The banking fraternity has consistently profiteered on the backs of the small business community, which has allowed them to be among the most profitable in Europe, without having to worry about being monitored or regulated effectively, providing them with a carte blanche to do as they pleased," it said.

"For too long the vested interests, including those who had responsibility for overseeing the practices of the banks, turned a blind eye to their misdemeanours".

"It is obvious that the banks are a law unto themselves and need to be properly regulated and controlled otherwise they will continue to run amok in exploiting their most vulnerable customers," the group said.