HSBC, the UK’s largest bank, has unveiled a £15 billion fund to help small businesses in the UK to rebound from losses caused by the COVID-19 pandemic.
The £15 billion allocation comprises the newest and largest-ever iteration of its SME Fund, which was first launched in 2014 with the aim of helping small businesses in the UK to grow.
The bank stated on Tuesday that two-thirds of the 2021 fund will be directed to specific regions, ensuring that companies throughout the UK are able to benefit from its support. The fund will also include a £2 billion ring-fenced pot for firms trading overseas and a further £1.2 billion for those in the agricultural sector.
Also new in the 2021 SME Fund are £500 million allocations each for technology firms and franchise businesses.
HSBC delayed the launch of the newest SME Fund from late 2020 to better coincide with the reopening of the UK economy. Its announcement comes a week after the release of the 2021 budget and the announcement of a new Recovery Loan Scheme for businesses to replace the Bounce Back Loan Scheme.
“We’ve helped British business get through the last year with over £14 billion of Covid-19 lending support,” said Peter McIntyre, head of small business banking at HSBC UK. “Now it’s time to turn our minds to what comes next and how we help companies grow again, opening up a world of opportunity and contributing towards a sustainable future society.”
SMEs will be able to borrow from the SME Fund on standard commercial terms, with loans beginning at £1,000.
Figures published on Wednesday showed that small business borrowing reached more than £100 billion last year, an increase of over 80%.