Owners of small and medium-sized businesses have welcomed the introduction of a new bank, Clear Property Investment has learned.

The British Enterprise Bank aims to raise around £100 million in order to make getting a business loan easier. It will target SME (small to medium-sized) firms who find it impossible to get a loan from the current high street banks.

A bank spokesman said: "BEB is aimed at addressing continuing complaints by politicians and small businesses that the SME market is unable to access adequate funds from the mainstream UK banks."

More than 20 branches of BEB are planned and will operate from business parks in the UK. In Scotland there are plans to set up in Glasgow, Edinburgh and Dundee. Staff will include high street bank managers. Independent financial advice will come in the form of Professor Merlin Stone who, in the past, has advised on banking matters for insurance giants such as Scottish Widows and Prudential.

He said: "We will obviously recruit from mainstream banks. There are a lot of unhappy people in banking at the moment, people who feel their jobs are threatened by what's happened to their companies."

Currently, two of the biggest lenders to small businesses are the public-owned Royal Bank of Scotland and Lloyds.

Backers of the bank - which is currently awaiting approval from the Financial Services Authority - claim that by funding small business, they will boost the British economy.

In terms of Scotland, BEB staff said the key players were in tourism, financial services, logistics and distribution.

News of the new bank comes as increasing numbers of desperate small firms have been forced to resort to other methods of funding as high street banks reject them.

Both the Co-op and Aldermore banks have been lending to SMEs in recent months. 

Aldermore CE Phillip Monks said his team were careful to lend to only credit-worthy and robust SMEs.

"We have also studiously avoided taking on more in deposits than we can sensibly put to work," he said.

David Bell, manager of the Co-op's Edinburgh corporate banking centre, said the banks "presence" in the business sector had benefited from its strong financial position and ability to grow.

For further information on investment opportunities and lending please contact any of our Clear Property Investment staff.



 

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