The state-backed bank will next week launch a pilot in Scotland and south-west England that will see SMEs that have been rejected for a loan referred to alternative lenders Assetz Capital and Funding Circle. A national roll-out is due to follow over the next three months, and RBS said it plans to work with as many as five so-called peer-to-business (P2B) lenders, which match borrowers with private investors.
Santander UK was the first mainstream bank to launch such an arrangement, when it teamed up with Funding Circle in June.
Chancellor George Osborne said: “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.”
Funding Circle, which counts the government-backed British Business Bank among its investors, has lent almost £494m. Assetz Capital launched in March 2013 and has lent more than £55 million to SMEs and property developers around the UK.
Andrew Holgate, managing director of Assetz Capital, said: “In the not very distant past, it would have been unthinkable for even a leading peer-to-peer lender to collaborate with a bank.
“However, it is clear that there’s a genuine desire emerging for banks to support SMEs more by introducing alternative lending industry options. We are proud to be working with RBS at the vanguard of this change and expect to deploy hundreds of millions of pounds at least over the next couple of years into great British businesses.”
RBS accounts for a third of the small business lending market and Alison Rose, chief executive of commercial and private banking, said the group is poised to become the largest player in the P2B loan referral market.
She added: “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. We are dedicated to supporting SMEs, whether they are an existing customer of RBS or not.”