HSBC is to open a £6 billion fund to help small and medium businesses (SMEs) fulfil their growth potential. It is hoped that this will encourage SMEs to make wise investments, which will further spur on the delicate economic recovery in Britain.
A turning point for businesses
The announcement goes hand in hand with a Business of Growth Report released by the bank, which found that 2014 would 'mark a turning point for ambitious businesses in the East of England’. It predicts an increase in fixed investment of 7.1 percent in 2014, and that international business activity will be increased by around 60 percent within 15 years.
Amanda Murphy, the head of HSBC business banking, has said of the fund: “We want to support their [SMEs'] ambitions by significantly increasing our net lending to businesses this year. We are helping more than 6,100 businesses start up every month, and want to support our hard-working SME business owners on their drive for growth.”
The increase in financial support available to SMEs will, indeed, be helpful at a time when funding has been very difficult to come by for many businesses. Companies nation-wide will be able to receive help, with the bank dividing the fund between 52 of its local business centres.
Targets still difficult to meet
Though this will provide useful backing for SMEs with turnover of up to £30 million, the European, Middle East and African Managing Director of HSBC, Alan Keir, said it would 'take considerable work by all parties' to achieve the British government's aim of doubling exports to £1 trillion by 2020. He pointed to a lack of business confidence, because despite British firms being 'among the most innovative and imaginative in the world’, they hesitated when looking to make investments or expand overseas.
With the 2012 HSBC International SME fund having helped more than 28,000 businesses, the SME Fund for 2014 should prove to be as helpful for those confident businesses with ambitious plans. Political uncertainties within the EU and UK may hamper business growth over the next few months, but should not hinder brighter prospects for British SMEs in the long term.