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RBS sets aside £2 billion in funding to help SMEs deal with Brexit

RBS sets aside £2 billion in funding to help SMEs deal with Brexit

The bank states that the cash would be used to provide services such as trade finance, term finance and increased liquidity for small businesses with rely on EU labour markets or exposure to foreign exchange movements

The cash is being made available through NatWest and will support both types of businesses.

Alison Rose, chief executive of RBS commercial and private banking, stated that Brexit “will require businesses to think strategically and tactically about how to navigate what is still an uncertain period ahead”.

RBS has said the money will help firms deal with supply chain issues and any financial risks that could potentially arise from the UK’s departure from the EU. The bank said it would contact about 2,000 existing RBS and NatWest customers that it thinks would benefit from the services.

The FT reported that UK banks have been making practical preparations as concerns grow about Brexit’s effect on supply chains and financial risks for businesses. These include the setting up of new continental European subsidiaries or transferring operations—all the while focusing on the domestic impact Brexit could have on their customers.

RBS chief executive Ross McEwa had warned earlier this month that the country was “sleepwalking” toward a “no-deal” exit, which is expected to have a significant economic impact.

The £2 billion fund will be added to an existing £1 billion ‘growth fund’ programme announced earlier this year in a bid by RBS to restore its reputation among business customers following the GRG scandal.

The bank said it had so far lent about £900 million of the initial £1 billion earmarked for investments in manufacturing and technology.

It is also paying for a £775 million scheme to boost competition as a condition of its 2008 bailout, including £350 million to encourage customers directly to switch provider.

The scheme is due to launch in February.

Ms Rose stated: “Earlier this year, we announced an additional £1 billion designed to help UK businesses invest in manufacturing, technology and development and have approved nearly £900 million for investment already.

“To triple this initial figure to £3 billion is tremendously exciting and we’re thrilled to be able to help British businesses keep growing.” She added.

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