Small and Medium-sized Enterprises

Lord Barnett Excerpts

Monday 29th October 2012 Lords Chamber

[Lord Newby]

My Lords, I think that a large proportion of these funds will be used for SMEs. That is why the banks have introduced new products specifically for SMEs following the introduction of the programme. I have already referred to RBS. Lloyds has done a similar thing and is reducing the interest that SMEs pay by 1%. Lloyds has placed double-page ads in some of the papers, which noble Lords may have seen. So the banks are directly targeting at SMEs a significant proportion of the funds that will now be available.

[Lord Barnett]

My Lords, given the urgent need for lending now, how soon does the Minister expect the first scheme to be in operation? Are the banks likely to offer 100% guarantees or will they require deposits?

[Lord Newby]

The scheme is already in operation and the process under which the loans are approved is going through. I do not know whether the noble Lord meant 100% in respect of mortgages as opposed to loans but, for mortgages, the scheme is being made available for first-time buyers, particularly in respect of the Government’s new buy scheme.