HSBC stated that the multi-billion-pound fund will help businesses to expand abroad and domestically
Banking giant HSBC has allocated £1bn ($1.26bn) for lending to small and medium-sized enterprises in Scotland bidding to build business and create jobs.
HSBC stated that the multi-billion-pound fund will help businesses to expand abroad and domestically, and that since launching the SME Fund in 2014, it has lent more than £90bn ($113.21bn) to help catalyse companies. This year’s Scottish total is up from £650m ($817.61m) last year.
The bank said it found that whilst concerns about the broader market remain, its customers are thinking about growth via investment, acquisitions and capital expenditure, with businesses reporting that they are ready to invest for growth and are confident about the prospects for their own businesses, seeing the biggest areas of opportunity as sustainability (12 per cent) and digitisation (11 per cent).
The bank also cited the Federation of Small Businesses finding that SMEs account for three fifths of the employment and around half of turnover in the UK private sector.
As well as regional allocations, the bank’s fund this year includes ring-fenced funding for businesses trading internationally (£2bn/$2.52bn) and the tech sector (£500m/$628.93m).
HSBC, which recently reported first-quarter profits of £3.3bn ($4.2bn), added that the fund is aligned with the Green SME Fund (£500m/$628.93m) for businesses of all sizes to transition and thrive in a low-carbon economy and the new Growth Lending Fund (£250m/$314.47m) for high-growth tech firms to support well-equitised, high-growth, loss-making scale-ups early in their growth journey.
The bank also said that last year, its SME fund enabled an Edinburgh-based blanket and scarf company to extend its premises and hire 40 staff with a seven-figure funding package. The Tartan Blanket Co. was able to buy a 32,000-square-foot warehouse in Newbridge, to meet increased demand from international customers.
UK Small Business Minister Paul Scully said the new fund puts HSBC on course to have lent more than £100bn ($125.79bn) to UK small businesses within a decade. This extra funding builds on the support available through government schemes like Help to Grow and Start Up Loans to help small businesses grow and reach their full potential, he added.