Sussex business owners are unhappy with the Government's decision to delay a requirement on banks to pay interest on company current accounts.

The county branch of the Federation of Small Businesses (FSB) said once again banks had managed to avoid giving firms a fair deal.

The Competition Commission published its report into small business banking in March and among its findings was the requirement that banks should pay interest on business accounts in credit and/or offer free banking to small businesses.

Chancellor Gordon Brown accepted the findings in full and said the Big Four banks were required to give an undertaking to abide by the rules within six months.

It had been suggested that the banks could not comply with the demands to pay interest on small business accounts for at least another six months.

FSB policy chairman John Walker said: "After an initial flurry of activity, we have seen very little evidence of progress at the main retail banks and we are worried the whole process is coming off the rails.

"The big four banks have huge resources at their disposal and we are disappointed those resources have been directed towards opposing the findings of the Competition Commission Report rather than carrying out its recommendations.

"This is a snub to the Competition Commission and the Office of Fair Trading (OFT).

"Small businesses now hold more on deposit with the banks than they owe in loans. If there are genuine reasons why there needs to be complex changes to banking systems before the banks can act, the least they could do is pay the interest retrospectively. We shall be pursuing the Treasury for just such a commitment."

Robert Davidson, who owns three shops in Brighton and Hove, said he felt banks had abused their position.

He said: "They have a captive market and they make their business customers pay dearly for it.

"If a non-business account attracts interest, it follows that a business account, if it is in the black, should also attract interest.

"Now the Government has intervened and said this is not right, the banks are still trying to wriggle out of a commitment they made."

FSB co-ordinator for Sussex Ken Stevens said members thought the issue had been won and were disappointed it would be early next year before their business current accounts earned interest.

He said: "This seems like another case where big businesses like the banks can get their way while small businesses have to accept what the are given."

Lloyds TSB has said the Competition Commission proposals would cost it about £100 million in annual profits. It was in discussion with the OFT about the implementation of the proposed reforms.