Photo: ShutterstockA lending commitment from the UK’s five leading banks — one of the largest collective moves by the banking sector in over a decade — will see UK businesses benefit from an £11 billion lending package to help them ‘invest and expand abroad, and thereby grow their businesses and the economy’. Late last month (26 January), senior executives from
NatWest,
HSBC UK,
Barclays,
Lloyds, and
Santander finalised an agreement with the Government at a ‘roundtable’ convened by the Business Secretary, Peter Kyle, and Tim Reid, CEO of
UK Export Finance (UKEF), the Government’s export credit agency.
Mr Kyle said: “Strengthening Britain’s export potential relies on British businesses having the means, motive, and opportunity to succeed in new overseas markets. The £11 billion these banks are making available will help meet the ambitions of smaller British businesses to fully export, expand and exploit international market opportunities. This lending package is positive proof of UK lenders’ confidence in the growth prospects of British enterprise.”
Chancellor of the Exchequer Rachel Reeves said: “We are turning the power of the City into ‘rocket fuel’ for UK exporters, backing ambitious firms in every part of the country to break into new markets, create good jobs, and drive the next decade of British growth. The lending will be drawn entirely from the banks’ own balance sheets and will give small and mid-size enterprises a powerful route to access the finance and expert advice they need to compete on the world stage.”
UKEF will guarantee up to 80% of eligible loans issued by each bank, and banks can apply UKEF’s guarantee automatically for working capital loans of up to £10 million. Alongside funding, businesses will also benefit from advisory support through banks’ relationship managers and UKEF’s regional export finance managers, helping them ‘navigate global markets and seize new opportunities’.
Mr Reid added: “Economic growth is the Government’s number one mission, and backing British exporters is central to delivering it. This partnership puts billions of pounds within reach of small businesses across the UK, reinforcing UKEF’s role as one of the Government’s most powerful levers for growth. It builds on its wider commitment to backing small businesses as engines of the economy, including measures to tackle late payments, cut red tape, and create the right conditions for investment.”