# Why European SMEs get the worst pricing from global banks and what to do about it Source: https://firmaadvisory.com/insights/european-sme-bank-pricing Last updated: 2026-10-01 TYPE html> Why European SMEs Get Poor Bank Pricing | FIRMA Advisory [Skip to main content](#main) By [Federico Lleonart](https://firmaadvisory.com/federico-lleonart) · Published October 1, 2026 · Updated October 1, 2026 · 6 min read Why do European SMEs get the worst pricing from global banks? Banks tier clients by expected wallet, and mid-sized companies often sit in segments served with standard price lists. Onboarding and compliance costs push banks further toward standard terms. SMEs improve pricing by concentrating business, bringing evidence and timing their requests well. Many European SMEs bank with a large international bank. The name brings credibility, global reach and a full product range. The pricing is often another story. Mid-sized companies frequently pay list prices for FX, payments and accounts, while larger clients of the same bank negotiate them down. ## How do global banks segment their clients? Global banks organize coverage by client size. Revenue, expected wallet and product needs decide which segment a company falls into. Large corporates get senior relationship managers, product specialists and pricing tailored to each deal. Mid-sized companies are often served by smaller teams that look after many clients each. That model is efficient for the bank. It also means pricing decisions follow standard grids more often than negotiated exceptions. The segment is not fixed forever. Growth, a new facility or a larger share of the company's business can move a client up. ## Why does segmentation lead to standard pricing? Every client carries fixed costs for the bank, such as onboarding, know your customer reviews and ongoing compliance. Those costs weigh more heavily on a smaller relationship. Banks respond by standardizing. Standard price lists, standard products and standard terms keep the cost of serving each client under control. None of this is hostile. But a company that never challenges the standard grid stays on it, often for years. ## Where does the gap show up most? ### FX FX is usually the largest gap. Payments in currencies outside the euro area are often converted at the bank's standard rate, without anyone checking the margin. ### Payments and accounts Account maintenance, payment fees and card charges follow the standard schedule. Accounts opened for past needs often stay open, each with its own fees. ### Credit Credit terms often reflect the company's position when the facility was first agreed. As the business grows, the terms rarely follow unless the company asks. A renewal is the natural moment to ask. The bank wants to keep the facility, and the company can link credit to the rest of its business. ### Worked example: the cost of standard pricing The table uses illustrative numbers for a hypothetical European SME. Every figure is invented to show the arithmetic. None of it is client data or a market benchmark. | Line | Illustrative standard pricing | Illustrative negotiated pricing | Illustrative difference | | --- | --- | --- | --- | | FX on EUR 40 million of non-euro conversions | 50 bp, EUR 200,000 | 20 bp, EUR 80,000 | EUR 120,000 | | Account maintenance | 15 accounts at EUR 40 a month, EUR 7,200 | 8 accounts at EUR 25 a month, EUR 2,400 | EUR 4,800 | | Payment fees | 60,000 payments at EUR 0.40, EUR 24,000 | 60,000 payments at EUR 0.15, EUR 9,000 | EUR 15,000 | | Total | EUR 231,200 | EUR 91,400 | EUR 139,800 | In this illustration, FX accounts for most of the difference. That is typical of the pattern, because FX margins are invisible on most statements. ## What the bank sees From the bank side, a mid-sized client is measured on the same scale as every other client: revenue, risk, capital and cost to serve. The result decides the coverage model and the pricing flexibility. The relationship manager often has some room to move, but needs a reason to use it. A specific request with evidence gives that reason, and a vague complaint does not. Banks also notice concentration. A company that spreads small amounts of business across many banks matters little to each of them. A company that gives one or two banks a clear, larger share of its business becomes worth more attention. The same total wallet buys better terms when it is concentrated. ## What can a smaller client do about it? Size is a starting point, not a verdict. These steps improve pricing for mid-sized companies. - **Measure first.** Build a baseline of fees and FX margins from statements and trade records. - **Concentrate.** Give more business to fewer banks, in exchange for better terms. - **Time the request.** Ask around a facility renewal, a new product need or an expansion. - **Ask specifically.** Request defined changes by service, not a general discount. - **Create competition.** Ask a second bank, global or local, for an offer on the same volumes. - **Verify.** Check that agreed prices appear on later statements. ## Should an SME add a local or regional bank? A local or regional bank often values a mid-sized company more than a global bank does. The same client can sit in a senior segment there, with better access to decision makers. The trade-off is coverage. A local bank may not offer the countries, currencies or connectivity a growing company needs. Many SMEs end up with a combination: a global bank for international payments and FX, and a local bank for credit and domestic business. Each bank then has a clear role, and each knows it competes for the rest. ## Does SEPA change the picture? SEPA lets one euro account send and receive euro payments across the SEPA countries. Source: [European Central Bank, SEPA](https://www.ecb.europa.eu/paym/integration/retail/sepa/html/index.en.html), checked October 1, 2026. That makes many local accounts unnecessary. Closing them reduces maintenance fees and simplifies cash management. The EU Instant Payments Regulation also requires payment service providers to charge no more for instant euro transfers than for comparable standard ones. Source: [European Central Bank, Instant Payments Regulation](https://www.ecb.europa.eu/paym/retail/instant_payments/html/instant_payments_regulation.en.html), checked October 1, 2026. Check your own price list against that rule. Some fee schedules still carry separate instant payment charges. The same regulation also requires a free payee verification service. It is a useful fraud control for any SME paying suppliers. ## Which checklist should an SME run before the next bank review? A short list keeps the review focused on the largest gaps. - What did we pay each bank last year, in total, across fees, FX and credit? - What margin over mid-market did we pay on FX conversions? - Which accounts could be closed now that SEPA payments run from one account? - Are instant euro payments priced the same as standard ones on our schedule? - Which bank would value a larger share of our business? - When is the next facility renewal, and what do we want from it? ## Which habits keep SMEs on standard pricing? Standard pricing persists through habit more than through bank policy. These are the habits to break. - Never asking for a pricing review between facility renewals. - Converting FX inside payments instead of trading it separately. - Keeping accounts open because closing them feels like work. - Spreading small amounts of business across too many banks. - Accepting a new price list without comparing it with the old one. Each habit costs little in a single month. Over several years, together, they explain most of the gap between standard and negotiated pricing. ## When does outside help make sense? Mid-sized companies rarely have a treasury team with time to build a baseline and run a negotiation. An adviser who knows how global banks segment clients can shorten both. Independent [SME banking advisory](https://firmaadvisory.com/european-sme-banking-advisory) builds the baseline, prepares the requests and supports the negotiation. FX is usually the first place to look, as [measuring your FX spread](https://firmaadvisory.com/insights/fx-spread-mid-market) explains. Where competition is needed, a well-run [bank RFP](https://firmaadvisory.com/insights/bank-rfp-scoring) does the rest. [](https://firmaadvisory.com/federico-lleonart) [Federico Lleonart](https://firmaadvisory.com/federico-lleonart) Federico Lleonart is the founder of FIRMA Advisory and its Head of Treasury Advisory. Formerly in cash management at J.P. Morgan and Barclays, he advises CFOs and private equity firms on treasury, banking and FX. [Read his full profile.](https://firmaadvisory.com/federico-lleonart) * * * This insight reflects general analysis and observations from FIRMA Advisory's work in treasury, banking, and cross-border financial advisory. It does not constitute investment advice, financial advice, or a recommendation in respect of any specific security, transaction, or financial decision. For analysis specific to your organization, contact us at [contact@firmaadvisory.com](mailto:contact@firmaadvisory.com). ## Continue reading ### [Measuring your FX spread](https://firmaadvisory.com/insights/fx-spread-mid-market) Where the largest pricing gap usually sits. ### [Running a bank RFP](https://firmaadvisory.com/insights/bank-rfp-scoring) How banks decide how hard to compete. ### [Reading your account analysis statement](https://firmaadvisory.com/insights/account-analysis-statement) How to build a fee baseline. ## Discuss your financial priorities with us. A brief, confidential conversation is the most efficient way to determine where FIRMA Advisory can support your organization. [Book a 30 minute call](https://firmaadvisory.com/contact) [contact@firmaadvisory.com](mailto:contact@firmaadvisory.com)