Royal Bank of Scotland says it has upped the pace of lending to small firms north of the Border this year as it unveils efforts to “rebuild trust” with its business customers.
Gordon Merrylees, managing director for business banking in Scotland, said lending to businesses with turnovers up to £2 million is 29 per cent ahead on last year, although he admitted he would “like it to be more”.
This is despite fears that net lending by UK banks to small and medium-sized (SMEs) businesses is shrinking despite support from the Bank of England’s Funding For Lending scheme.
Merrylees said: “If I look at this year versus last year, I hit £100.4m in week 39. By the end of this week, I will have lent already what I lent the whole of the year to date. My numbers are up 29 per cent. I’d like it to be more but it is good progress.”
This week Merrylees was taking part in a programme whereby RBS “relationship” managers spend a day working for their business customers.
The group’s corporate banking division has undertaken 4,300 “working with you” sessions with existing and potential customers in Scotland.
Merrylees’ small business team has completed 420 visits in the last year, with him and his staff offering mentoring support, introductions to other clients as well as the chance for customers to discuss funding requirements.
The scheme was launched by Chris Sullivan, chief executive of RBS’s UK corporate banking division, in 2011 in an effort to restore the bank’s battered reputation with business customers.
RBS managers must make the visits as part of an internal accreditation programme.
Merrylees said: “Internally there is a huge change in culture. We have a programme to focus externally with customers. We are trying to professionalise our workforce. Chris Sullivan wants to rebuild that trust.”
He said the bank was able to capitalise on its 40 per cent business banking market share in Scotland in order to link firms that could offer further support.
“I have been with RBS 28 years,” he said. “There are certain things that customers expect us to do get your bank account sorted, transfer money, set up direct debits. These are givens and are not differentiators. The value you can add is by the advice you can give and the technical knowledge you can give. For me because we have such a reach in Scotland – we bank about 40 per cent – connecting customers and putting them together to help businesses grow is crucial.”
This week, Merrylees met Cassie McNamara, founder of Birthsparks, which creates clinical products designed to support mothers during pregnancy and birth.
McNamara was one of the first “chiclets” to take space in Entrepreneurial Spark’s Ayr business accelerator, supported by Sir Tom Hunter. The firm recently won a £30,000 “Edge” award from Scottish Enterprise, which also included a package of business mentoring support from RBS.