Discounted loans make a difference
STAFFORDSHIRE firms have secured more than £15 million in discounted loans in less than three months.
Banking giants RBS and NatWest have handed out more than £15 million to small to medium companies in the county through the Government's Funding for Lending scheme (FFL) since August 1.
Firms which have taken advantage of the scheme so far include animal rendering plant John Pointon & Sons of Cheddleton, which has landed a £1.5 million loan.
The FFL scheme was unveiled by the Treasury and the Bank of England in the summer. It aims to increase bank lending by around £80 billion, by allowing commercial banks to borrow funds from the Bank of England more cheaply, in the hope that they will pass it on in the form of cheap loans to households and businesses.
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RBS and NatWest say they have already made more than £1 billion of loans available for companies, with small to medium firms benefiting from interest rate cuts of up to 1.7 per cent.
They have also abolished arrangement fees through the scheme.
Simon Durrant, managing director at John Pointon, which employs around 215 people, said: "We are putting our loan towards a big project which we've been planning for three years." The firm currently burns tallow as the energy source for its rendering process but is now bringing a main gas line on to the site.
Mr Durrant said: "It will be more cost-effective and will allow us to sell on the tallow we don't use.
"We approached our bank at same time that the National Loan Guarantee Scheme was coming to end, and they said we could take advantage of Funding for Lending.
"I'm really pleased they told us about it, because the trouble with all Government banking incentives is that they are very woolly and even if you Google them, you don't find out much about them."
Other North Staffordshire firms to have benefited from the scheme include sandwich-maker The Good Food Chain in Stone and Talke-based haulage company Barry Proctor Services.
Mr Proctor, pictured below left, said: "We have taken out a £45,000 loan for our truck insurance. We do it every year when we renew in August because it's quite expensive and it helps with our cash flow.
"This year, it was even cheaper because there was no arrangement fee, which is normally about £750.
"Other than that, we don't have any borrowings at all, we don't even have an overdraft. But this crops up every year and we find it helpful."
RBS corporate banking chief executive Chris Sullivan said: "This is a real opportunity to stimulate growth in Staffordshire and across the UK."
Do you think banks are lending enough to companies? Email us at businessdesk@thesentinel.co.uk
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