DEMAND from small and medium-sized businesses in Scotland has prompted bank giant HSBC to launch a £450 million lending fund.
It is aimed at supporting SMEs as part of the bank’s broader commitment to make banking “cheaper and simpler” for customers.
The £450m fund is the largest package of support to be announced by HSBC for SMEs in Scotland. The bank says it has been introduced to meet growing SME demand across the country and is a significant increase from the £400m fund allocated to Scotland in 2015.
The 2016 SME fund and broader package of support for Scottish SMEs includes a free banking offer of up to 18 months for start-ups and 12 months for switchers as well as the introduction of a year-long fixed-price £5.50 monthly account tariff, to begin at the end of a customer’s initial free banking period.
There will also be a reduction in the personal guarantee fee from £80 to £10 for any lending facility above £10,000 and the launch of the Business Lending Eligibility Checker (BLEC) – an online tool offering potential new customers a credit decision in principle for loans of up to £30,000 in under two minutes.
The package includes a free text alert service for informal overdrafts to help customers avoid paying informal overdraft fees and interest.
“We want to be the bank of choice for Scottish SMEs, reinforced through our desire to lend more to local businesses, by committing the funds to do so, and by making banking easier and cheaper to help our customers grow,” said Susan Rowand, HSBC’s head of business banking in Scotland.
“There is a strong desire from ambitious local SMEs to grow their businesses, and we are responding by ensuring HSBC is providing the funds they need to realise these ambitions.”
HSBC’s head of UK commercial banking, Ian Stuart, added: “Right across the UK there is a wide range of innovative new and established SMEs, proving that location is no barrier to a great business idea. SMEs are the driving force of the UK economy and we are here to support them, whether they are a start-up or established business, focused either on the domestic market or looking to trade internationally. This fund underpins our support by putting SMEs in a stronger position to be making investments that will stimulate local economies and create more jobs.”
The UK Government’s Small Business Minister, Anna Soubry, encouraged small businesses to capitalise on the services being offered by lenders to support their growth.
“We have a record number of small businesses driving our growing economy and while the picture is improving, access to finance remains an issue for many of them,” she said. “It’s absolutely right that banks such as HSBC continue to develop their support for smaller businesses. I also want to see more of these businesses taking advantage of what’s on offer, both from banks and alternative lenders, to help them grow, invest and create jobs for people.”
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