Barclays Increases Lending Commitment To Small Businesses To £16.5 Billion

The FINANCIAL — Barclays on December 15 announced a two-pronged plan to enhance its practical support to small and medium-sixed enterprises.

Barclays, one of Britain's leading banks for small businesses, today announced a two-pronged plan to enhance its practical support to small and medium-sized enterprises (“SMEs”).

Barclays currently has some £15 billion in lending balances in place with SME customers in the UK market, up six per cent year on year. Recognising the need to support this vital part of the economy, Barclays commits to making at least a further £1.5 billion available to SMEs in 2009, bringing its total commitment to some £16.5 billion by the end of 2009.

At the same time, from today, Barclays will make available its CreditFocus service free of charge to all UK small businesses, whether or not they are a Barclays customer.

CreditFocus provides users with the ability to credit check and be regularly updated on the credit worthiness of up to five customers or suppliers, which helps business owners make decisions on extending credit to their own customers/suppliers. CreditFocus, which was developed in partnership with the credit reference agency Experian, was the winner of the Institute of Financial Services (IFS) Award for Innovation Excellence in 2008. Barclays will completely cover the cost of providing this service to all small businesses.

“Especially during this time of uncertainty, Barclays is committed to lending to and supporting our business customers,” says John Varley, Group Chief Executive. “We have a strong history of working with business owners through economic highs and lows, and that support will continue. Today's commitments are aimed at helping SMEs in the UK cope with the difficult environment.”

Barclays is also working closely with the Government to develop the new Small Business Finance Scheme. Barclays intends to use this scheme early in 2009 to support individual business loans from £1,000 to £1,000,000. It was also the first UK bank to take part in the new European Investment Bank Scheme by providing a £300 million loan earmarked for small and medium businesses.

Steve Cooper, managing director of Local Business for Barclays, says: “Two of the leading causes of business failure are late payments and bad debt. Our CreditFocus service will help all small businesses, whether or not they borrow or bank with Barclays, to get paid and paid in a timely manner.

“Our loan commitment will help keep funds flowing, and we will begin the New Year by promoting the Small Business Finance Scheme. I am proud that our customers will be among the first to benefit from the new European Investment Bank Scheme.”