Lloyds Banking Group has announced
a new unilateral commitment to lend at least £12 billion to help
Britain's small and medium-sized businesses in 2012, as part of its
continuing effort to help rekindle business confidence, stimulate
demand for finance, and fuel economic growth. The move represents
an increase on the Group's current Merlin target, agreed with the
Government in February 2011.
In addition, the Group has pledged that the important measure of
net lending - the difference between lending drawn and lending
repaid - will remain positive. This comes during a time when the
industry's net lending levels are negative because businesses are
in general repaying more than they are borrowing.
The new lending pledge is the cornerstone of Lloyds Banking
Group's SME Charter, which has been bolstered to help address the
main challenges now facing the UK's five million small and
medium-sized businesses.
Through the new Charter the Group is redoubling its efforts to
help exporters, manufacturers, student enterprises, and businesses
in deprived areas. It sets out pledges to invest £20 million in
community finance projects, including businesses in the country's
poorest neighbourhoods, during the course of next year; and to
boost the number of students involved in enterprise associations by
40 percent - from 50,000 to 70,000.
Since Lloyds Banking Group first published its Charter in 2010,
it has supported more than 200,000 start ups, and has held more
than 1000 events designed to help businesses talk to their local
business managers and get advice on the issues that matter to them.
These achievements are in excess of the pledges made in 2010 to
help 100,000 start ups and hold 200 customer events each year.
John Maltby, Group Director, Commercial, Lloyds Banking Group
said: "Our business is supporting businesses. That is what we do.
Times have been tough for Britain's small firms, and demand has
continued to weaken. But our commitment is unequivocal and we want
them to know that, as and when they need to borrow, we are ready
and waiting to lend.
"We are committing to lend at least £12 billion next year,
focusing on the small businesses that are the lifeblood of our
economy - and we hope that this pledge proves to be the confidence
boost that will help to kick start real growth. There are no caps
and no quotas - we will simply lend where the money is needed and
will go beyond our commitment if the demand is there."
"Our support stretches far beyond lending. Businesses also need
to know that our pricing is fair and transparent; that we can offer
different types of finance; and that we will work to encourage
enterprise. They also need the assurance that we will support them
at a local level and that they can appeal with confidence. It is
these issues our Charter, spearheaded by our new lending pledge,
aims to address."
During the first nine months of 2011, Lloyds Banking Group lent
£9.6 billion to small and medium-sized businesses. The Group's year
on year net lending growth in its core commercial businesses was
over two per cent, as at the end of September 2011, while the
industry's net lending levels declined.
Phil Orford, Chief Executive, The Forum of Private Business,
said: "This pledge is a timely initiative which should help boost
confidence for those businesses seeking finance. Lloyds Banking
Group is one of the banks that has been working hard to support
small businesses. But with growth still extremely slow and
investment frozen, further action and additional competition from
banks is vital - so this is a very welcome move."