HSBC has unveiled a record £15bn lending fund for Britain’s small businesses, to help spur on their recovery from the pandemic.
The banking giant has announced that two-thirds of the fund will be directed to specific regions, ensuring that companies throughout the UK are able to benefit from its support.
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The fund will also include a £2bn ring-fenced pot for firms trading overseas, as well as £1.2bn for those in the agricultural sector. And allocations for technology firms and franchise businesses, at £500m each.
The bank had delayed the launch of the fund from late 2020 to better coincide with the reopening of the UK economy.
HSBC said it hopes the fund will allow small businesses to capitalise on the rebound once lockdown ends and help support Britain’s wider economic recovery.
Recent research carried out by the bank showed nearly two-thirds ( 62%) of companies plan to boost investment in their business over the next year.
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By GlobalDataGalloping demand expected
Peter McIntyre, HSBC’s head of small business banking, said he expected “demand to build and build quickly” as lockdown restrictions eased in the coming weeks.
“The fact that we have a clear roadmap out of lockdown has given businesses a lot of cause for optimism,” McIntyre said. “A lot of businesses are very positive.”
Small business minister Paul Scully said HSBC’s fund would “help small businesses not only prepare for reopening, but to try new ideas and build back better from the pandemic.”
Entrepreneurs can borrow as little as £1000
Businesses can borrow as little as £1,000 from the SME Fund on standard commercial terms. McIntyre said the funds would help the “Instagram entrepreneurs” that had sprung up during lockdown and support the “disruptive entrepreneurship” of established business owners.
“People are looking at: how do I take my business model and take the opportunity to grow as I come out of this the other way?” he said. “Whilst Covid-19 has presented an unprecedented level of disruption, it’s given that impetus to rethink processes, review relationships, consider new markets, revisit supply chain and the resilience of supply chain as well.”
Figures published this week showed that small business borrowing reached more than £100bn last year, an increase of over 80%.
