Bank hikes lending to SMEs by £1bn

A bank has announced it is to increase its lending to small and medium sized businesses by a further £1 billion this year to help them make the most of the economic recovery.

Bank of Scotland will also double the amount its local managers can lend without central approval
Bank of Scotland will also double the amount its local managers can lend without central approval

Bank of Scotland will also double the amount its local managers can lend without central approval.

The pledges are part of a new charter which the bank has drawn up to help small firms harness growth opportunities as the economic recovery gathers pace.

The bank said the charter also reaffirms its focus on supporting fledgling businesses, with a renewed commitment to help 100,000 start-ups get off the ground this year.

Alasdair Gardner, managing director of Bank of Scotland Commercial Banking, said: "This new charter clearly sets out the pledges we are making to our customers. We are committing to grow our total lending by £1 billion in 2014, at competitive margins, building on the growth we have achieved over the past three years; and we have doubled the amount certain local managers can lend at their own discretion.

"We will be fair and transparent in all of our dealings with our customers; and will provide broader support through our relationship managers and business specialists, as well as a growing number of business mentors.

"We are now seeing the recovery gathering pace and there are more reasons for small and medium-sized enterprises (SMEs) to be optimistic and to start investing for growth. We will continue to give businesses the backing they need, so that they can seize these opportunities. Our goal is to help businesses target their various growth opportunities both this year and beyond."

Under the new charter the amount of money senior local managers can lend without having to ask for central approval will increase from £500,000 to £1 million, where they are agreeing to renew lending.

Trade finance lending, used by businesses when exporting across the globe, will increase by 25% in 2014.

The bank said it is also building on pledges from its first charter for SMEs in 2009, such as ensuring that they get access to the finance they need on terms that are fair and understandable, and that they get a broad range of support, including help with alternative forms of finance.