Banks: Small and Medium-sized Enterprises

Lord Howarth of Newport Excerpts

Wednesday 12th March 2014 Lords Chamber

[Lord Popat]

The noble Lord makes an important point and I pay tribute to the work he has done on driving greater transparency in local lending. An effective referral system needs to be transparent to build trust among businesses and alternative finance providers. I welcome the recent comments made to the Treasury Select Committee by the independent external reviewer of the banking appeals process, Professor Russel Griggs. He agreed that more could usefully be done to integrate banks in terms of the outcome of referrals and on signposting processes.

[Lord Howarth of Newport (Lab)]

My Lords, why do the Government not do more to use the leverage that they have over Lloyds Bank and RBS to require the management of those two banks, at any rate, to focus more on the interests of the economy and society and less on feathering their own nests?

[Lord Popat]

My Lords, the taxpayer had to bail out both RBS and Lloyds Bank under the previous Government and we continue to pay for the mistakes of the past. Both banks are now becoming smaller and safer, but there is a long way to go. Since the launch of the Funding for Lending scheme, RBS and Lloyds Bank are now both lending more money to our SMEs.