SMEs missing out on loans from Europe, says EIB chief

Simon Brooks, vice-president of the EIB, a not-for-profit bank owned by the European states, said there was "slower uptake" of the loans in the UK than had been expected.

Last week, the UK Treasury said more than 700 million of a potential 4 billion of EIB loan funding had been approved for nearly 3,000 small UK businesses.

Stuart Mackinnon, head of public affairs for the Federation of Small Businesses in Scotland, said the banks offering the loans needed to work more closely with firms and that bureaucracy was a turn-off.

"The core issue about a lot of these funds is that they're administered through the banks," he said. "Bridges still need to be built between small firms and Scotland's big banking players. Bureaucracy, actual or perceived, and a lack of awareness can be serious barriers to their success."

The loans are administered in the UK through Lloyds Banking Group, Barclays Bank, Close Brothers, Royal Bank of Scotland and Santander.

It is understood RBS has allocated more than 75 per cent of its share of the EIB funding and that pick-up of the scheme had been strong in the past few months especially. An RBS spokesman said: "We are very supportive of all these lending schemes."