RBS ties up with P2P lenders
The Royal Bank of Scotland will formally refer small businesses it cannot help to peer-to-peer options for alternative sources of finance.
RBS said from next week the bank will refer businesses to peer-to-peer lenders Funding Circle and Assetz Capital, where ‘the online marketplace is better placed to help’.
RBS said it accounts for 33% of the small business lending market, which would make it the largest lender to refer small business customers.
The bank wrote: “After having explored invoice finance, asset finance, the Enterprise Finance Guarantee Scheme and the Regional Growth Fund, customers will be asked to visit the British Business Association’s (BBA) dedicated website which also offers additional support.”
Funding Circle and RBS have been part of the Treasury’s working group examining how best to encourage greater collaboration between high street banks and alternative finance providers.
RBS said it intends to expand choice for customers whose loan applications do not currently meet the bank’s criteria by signposting them to a number of alternative finance providers.
RBS said referrals will take place during conversations its customersl have with a relationship manager or through documents included with correspondence. The pilot begins next week in Scotland can South-West England; with a national roll-out in business banking due to follow over the next 3 months.
George Osborne, UK Chancellor of the Exchequer, said: “It’s only through harnessing innovations in finance, alongside our existing world class knowledge and skills in financial services, that we’ll ensure Britain’s financial sector continues to meet the diverse needs of businesses here.
“That is why I announced a further package of measures to support peer-to-peer platforms at last month’s Autumn Statement, including a new bad debt relief to create a level-playing field for the industry.
“It is great to see companies like Funding Circle forging a new partnership with RBS to ensure that small British companies have the best access to funding.”
Alison Rose, RBS chief executive officer, commercial and private banking, said: “We are committed to doing the right thing for our customers by helping them access finance where we cannot help them within our current risk appetite. I am delighted to see RBS partnering up with both Funding Circle and Assetz Capital. We are dedicated to supporting SMEs, whether they are an existing customer of RBS or not.”