New fund launched offering billions to SMEs

HSBC has announced an £8 billion fund set up specifically to help the UK's small and medium-sized businesses.

The bank claims the fund will help those looking to start a new business, as well as provide for established local businesses.

The national £8 billion SME fund will be allocated in 43 local tranches across the country.

Manchester, West Yorkshire, Birmingham and Scotland will each have access to a £400 million fund, with Tyne Tees, Cambridge, Liverpool and Cheshire and Bristol and Bath, Kent and Thames Gateway each having access to £150 million.

London will enjoy a fund of £2.1 billion.

James Cliffe, HSBC head of business banking, says the increased risk of lending to start-ups ‘would not preclude’ the bank from doing so.

‘If we are presented with a viable proposition, and we have confidence in the management and the cash flow projections, then yes, we will fund it,’ he adds.

‘What it comes down to is having demonstrable cash flow because we lend against cash flow. What we aren’t is equity providers and equity providers will lend against a concept or an idea and a concept or an idea doesn’t have a proven cash flow.

‘So if people have equity needs they should be talking to business angels or a start-up loan company that the government has backed. We as a high street bank can support businesses with demonstrable cash flow and help them grow.’

In addition to the fund, more than 300 workshops nationwide will aim to support 10,000 businesses in seeking to grow from start-ups to established firms, HSBC says. 

Within these workshops entrepreneurs will be challenged on how they are going to grow their business and given insight from people who have been successful, as well as being able to gain best practice from other successful entrepreneurs.

Further reading on business loans

Ben Lobel

Delphine Hintz

Ben Lobel was the editor of from 2010 to 2018. He specialises in writing for start-up and scale-up companies in the areas of finance, marketing and HR.

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