Bank introduces instant access to overdrafts and business loans following new research suggesting 5,100 extra jobs could be created by SMEs by 2021
Barclays customers are set to benefit from a new mobile lending service offering instant access to overdrafts and SME loans.
The bank has become the first of its kind in the UK to offer the service – available to its client base through the Barclays Mobile Banking app – which it says radically reduces the time taken to secure a loan from weeks to under an hour.
The launch follows new research which reveals that more than 5,100 extra jobs are waiting to be created from Scottish SMEs by 2021.
Barclays says although nearly a third of SMEs are not planning to apply for a loan, yet they acknowledge it would boost their business, the research shows 64% of them would experience an increase in turnover should they successfully secure the right credit. It claims this, in turn, could generate more than 5,100 extra jobs in Scotland over the next four years.
The research also found that:
Across the UK, 30% of SMEs have decided not to apply for a loan despite thinking it would boost their business.
SMEs who have applied for funding expect the lending process to take at least five weeks, whereas for many the funds are now available on their mobile, pre-assessed, so they can access funding within one hour.
Removing the myth that banks don’t want to lend by making loans and overdrafts available instantly on smartphones could deliver over 5,100 extra jobs in Scotland by 2021, generated from growth by Scottish SMEs. This would mean £2 billion economic boost per annum for Scotland’s economy, if invested in productive potential.
Of all the regions in the UK, London would generate the most new jobs from extra lending to SMEs, with the South East and East Midlands in second and third place respectively. In terms of economic boost, Scotland would have the third largest growth (£2 billion) behind London (£2.6 billion) and North West (£2.3 billion).
Jamie Grant, head of Business and Corporate Banking for Barclays Scotland, said: “We recognise that some businesses are cautious about applying for a loan, whilst many more simply do not have the time.
“Our new, pre-assessed lending gives customers the ability to see how much they could borrow on their mobile and we can get that money to them more quickly than ever so they can invest in and focus on running their businesses.”
Brexit presents new reasons to lend
The research also found that one in five SMEs believe Brexit is impacting their current or future funding requirements. Of those, the most common reasons cited were a need to start exporting to new, non-EU markets, Brexit economic uncertainty and a need to replace current employees who are EU citizens. A further one in 10 (12%) SMEs did not know whether they would be impacted by Brexit.
However, a quarter (24%) of SMEs believe it will be harder to secure a loan in 2017, with Brexit causing economic/political uncertainty and global economic uncertainty cited as the main reasons.
Grant added: “Since the EU Referendum our appetite for lending has not diminished and we continue to lend to an SME in the UK every four minutes. We want to help SMEs in Scotland be confident in their future business plans, including looking at new opportunities to export. We are particularly determined to reach out to those businesses who believe lending will be more difficult next year to see where we can help.”