Banks pledge to support to SMEs through Brexit in new Charter

Britain's top banks and finance providers have reaffirmed their commitment to backing small businesses (SMEs) through access to finance, helping SMEs plan for the future ahead of Brexit.

SME Finance Charter Brexit

What is the SME Finance Charter?

All businesses need finance. This may come from the owner, from past profits made by the business or from an outside source, such as a bank or another finance provider. If your small or medium business relies on outside finance, the SME Finance Charter is for you.

The Charter is a voluntary agreement that covers:

  • loans and overdrafts
  • asset finance including HP (hire purchase) and leasing
  • stock lending
  • invoice finance

The aim of the Charter is to let SMEs know:

  • how UK lenders in general plan to support their business customers
  • what this means for the business, if its lender has signed up to the Charter
  • how other lenders are responding, so that SMEs can compare

The SME Finance Charter was adopted at the first meeting of the new Business Finance Council. Co-chaired by Business Secretary Andrea Leadsom and Economic Secretary to the Treasury John Glen, the meeting was attended by representatives from the UK?s leading banks, alternative lenders and representatives from the British Chambers of Commerce and the Federation of Small Businesses.

What pledges are made in the SME Finance Charter?

The SME Finance Charter is made up of five overarching pledges that were identified by the Council as significant to ensuring the SME finance market works effectively.

The pledges made by finance providers through the SME Finance Charter include:

  • confirming they are ?open for business and ready to lend? which includes specific funds they have set up for SME lending
  • helping SMEs to prepare for Brexit and beyond by setting out the resources that they can provide
  • providing clear and accessible information for SMEs seeking finance, including expectations around the management of accounts, cashflow projections and security, explaining options if initial applications are declined
  • treating all customers fairly, explaining how they will resolve any disputes that may occur
  • working with the government-owned British Business Bank to signpost their guidance and to help businesses secure a loan or overdraft even if they lack the security for the borrowing, giving SMEs the ability to invest and expand

The above pledges provide a framework for lenders to set out their own individual commitments to SMEs in the coming weeks. To become signatories to the Charter, each lender will need to demonstrate the specific actions they are taking to deliver on the pledges.

Who has signed up to the SME Finance Charter?

Banks and lenders who have set out their commitments and therefore become signatories to the Charter currently include:

  • Aldermore
  • Bank of Ireland
  • Bank of Scotland
  • Barclays UK
  • Bibby Financial Services
  • Close Brothers
  • CYBG
  • Funding Circle
  • HSBC
  • Lloyds Bank
  • NatWest
  • RBS
  • Santander UK
  • Secure Trust Bank
  • Simply Finance
  • Ulster Bank
  • Ultimate Finance

See also

Customise your company profile

How can SMEs improve employee retention?

How small businesses can win public sector contracts

Find out more

SME Finance Charter (Gov)

Image: Getty Images