Well done RBS Group- I think you’ve managed to make a first small step towards winning back a little confidence from small business owners.
Here’s a government-backed scheme that understands what small firms need right now, and delivers it without complication. If you need to finance growth but struggle to raise the deposit for a loan or would find the repayments tough, how would a 20% grant help? Or if you’re in an Assisted Area, you could add another 15% to that. Not bad eh?
The RGF (Regional Growth Fund), which has previously been open only to major bids of £1m plus, has now found its way into the domain of individual small businesses, and RBS Group have a £70m fund to distribute- they’re going to do this by offering grants of £5k to £500k to businesses that they would otherwise have turned down for loans or Lombard lease purchase schemes. You don’t have to bank with them either. The process sounds simple, tucked away in the bankers’ back offices so SMEs don’t get drawn into the bureaucracy. It won’t slow down a loan or lease purchase application period, which could be a few days to a few weeks.
What are the catches? Not onerous actually. You’ll need to show your growth will create employment– this scheme overall has to create or safeguard just 2,000 jobs for it’s £70m of government cash- that’s one job per £35,000 of grant, so if you worked on one per £20,000 you should sound an attractive proposition.
You’ll need to use the cash to assist the purchase of an asset– so could be property (for your own use, not for development!), machinery, equipment, vehicles (not cars) etc. Someone asked me if they could use it to instal solar panels- and why not, so long as that purchase enabled the recruitment of at least one more employee.
Your finances must be tight enough that RBS would have turned you down under their normal commercial terms- bet that’s not difficult! And be based in England, excluding London and the South-East, with no more than 250 employees.
By the way, all the banks had a chance to run this scheme, and all except RBS/NatWest/Lombard, and a smaller similar programme run by HSBC (only if you bank with them) turned it down. Come on you lot, what else will you offer to get back onto our Christmas card list?
(more about government funding at phmc.co.uk/pages/funding.aspx)