Small and Medium-Sized Enterprises: Funding

Lord Sharkey Excerpts

Tuesday 25th June 2013 Lords Chamber

Asked By

[Lord Sharkey]

To ask Her Majesty’s Government what assessment they have made of the success of their initiatives to increase funding to small and medium-sized enterprises.

[Lord Popat]

My Lords, the Government are helping more small and medium-sized businesses to access financial schemes including Funding for Lending, the enterprise finance guarantee and Enterprise Capital Funds. The enterprise finance guarantee scheme has enabled £1.2 billion of lending to 11,700 businesses, the Enterprise Capital Funds scheme has invested over £110 million in over 80 companies, and Funding for Lending has supported many more. The Government recognise that more can be done and are launching the business bank with £1 billion of new capital to bring the schemes together.

--- Later in debate ---

[Lord Sharkey]

The fact is that net lending to SMEs is down again. That may not be surprising. Only a quarter of all SMEs are aware of the Funding for Lending scheme. The banks must know that you cannot sell a product if your customers do not know about it. Does not the figure of 25% of SMEs aware of the Funding for Lending scheme strongly suggest that the banks do not actually want to lend to SMEs?

[Lord Popat]

My Lords, the Government’s own research shows that awareness of the access to finance schemes has fallen in recent years. This is why we are launching a tailored marketing communication campaign to increase the awareness of many government access to finance schemes available to small and medium-sized businesses. This activity usually results in a highly successful brand. The launching of the business bank next year will solve part of that problem.