Directors appeal to banks to give e-business helping hand

A report released last week by the Institute of Directors (IoD) found that the big five banks were holding back e-business in the UK.

The survey carried out by IoD members revealed that many banks did not trust existing e-business security systems to support safe online credit card transactions.

Jim Norton, head of the e-business team at IoD, said: "Banks are very worried. They may be left with a large number of liabilities from e-business companies."

Norton added that he believed these fears were overstated: "There are some protections they are ignoring."

The study found that many e-business companies are being forced to use more expensive second-tier banks for clearing facilities. Norton said e-business must be taken into the mainstream and supported by the major banks: "Companies must complain about this and not accept the high prices coming from the secondary sector."

Norton added that the Government must step in and take action to support companies struggling as a result of the banks' attitudes. "The Government needs to broker a discussion to enable banks to support these businesses much better, and this may mean some minor changes to legislation," Norton said.

However, the research warned that heavy-handed e-business regulation would not be welcomed.

Richard Baron, deputy head of the policy unit at the IoD, said: "We must work to ensure that everyone is fully aware of, and to remove the obstacles that are preventing UK business from taking full advantage of the opportunities of e-business."

The IoD has presented a series of case studies to the Cabinet Office for review by e-envoy Alex Allan and the Treasury's banking review team led by Don Cruickshank.