If anything positive came out of the banking crisis for local business, it’s the creation of a myriad of non-bank lending institutions.
On the Kent Business Bunker show on Channel Radio, we spoke with two Kent County Council officials responsible for lending money to SMEs from specialist business funds.
What’s clear is that there are very few businesses are actually stepping forward to claim the help. And if we don’t use it, we lose it for next year.
Right now KCC has tens of millions of pounds available in the form of zero percent-interest loans for startups in east Kent alone. The Expansion East Kent scheme helps businesses with the potential to create jobs in Canterbury, Thanet, Dover and Shepway. It has £35 million on tap – money that could be helping hundreds if not thousands of small and medium sized businesses.
KCC stepped in after it became clear banks weren’t prepared to take on the risk of providing funding to small businesses because the recession and tougher controls by regulators.
“Clearly banks weren’t lending,” Mark Dance, a KCC Cabinet member, told me and presenter Paul Andrews. “I think we embarrassed them with our talk of regeneration and the economy.”
By taking the first step in lending, KCC helps absorb the risk for banks. It looks for banks to match the council’s funding one-for-one, said Jacqui Ward, manager of KCC’s Regional Growth Fund.
As we were discussing the funds, London mayor Boris Johnson followed us on Twitter, so word is getting out.