Isherwood speaks out for small businesses

North Wales Assembly Member Mark Isherwood has emphasised the importance of access to finance for small and medium enterprises (SMEs).

Mr Isherwood is concerned that the Federation of Small Businesses states that SMEs in Wales are significantly less optimistic about their business prospects than their counterparts in the rest of the UK – and that 64% have never heard of Welsh Government subsidiary Finance Wales.

Speaking in the Welsh Conservative Debate on ‘A Vision for Welsh Investment: Invest Wales’, he said: “That is why Welsh Conservatives have launched Invest Wales, using Finance Wales funding to regionalise access to finance for Micro, Small and Medium size Business with Welsh HQs - encouraging High Street lending, not just state banking.

“This would complement the UK Government’s Funding for Lending Scheme, operating since last August to incentivise banks and building societies to boost their lending to UK households and non-financial companies.

“As the Bank of England stated last month 'the Funding for Lending Scheme has helped to improve funding conditions for UK firms' and '35 banks and building societies had signed up to the scheme, representing 82% of the stock of lending to the domestic economy'.”

Speaking in the chamber three years ago, Mr Isherwood highlighted the Banking on Essex initiative, to support SMEs, the first municipal banking scheme to be created since 1915, with Santander Bank as 50% partner – thereby taking half the risk and slashing the amount of costly regulation that a new bank would have to comply with, but that an established bank partner would not.

“As the First Minister then agreed, setting up a new bank can be a costly and protracted business if you start it from scratch and using the expertise that is already in the banking sector to develop a social model of banking makes sense.

 

"Banking on Essex subsequently closed, citing a lack of demand from small businesses – but, as the Federation of Small Businesses has stated 'Wales has the highest share of small businesses applying for credit of any UK region or country'."

 

Invest Wales, with an independent board, 50/50 partnership with banks and other financial institutions and a regional branch structure is the prudent model for Wales’ business and banking sectors.

 

"After all, some 8.4% of the economy in Wales is generated by financial services.”