A Labour Member of the Welsh Assembly is asking all UK high street banks, to explain what steps they have taken to advise their small business customers of the the availability of vital European funds, set aside to help them during the current economic downturn.
Wrexham AM, Lesley Griffiths, has written to HSBC, Barclays, NatWest, Lloyds TSB and the Royal Bank of Scotland, to find out what action they have taken to distribute billions of Euros worth of vitally needed loans and guarantees, provided by the European Investment Bank (EIB) in recent months, to help firms avoid bankruptcy.
Earlier this year, the EIB made €30 billion (Euros) available over the next three years, at reduced rates, to banks across the EU to help deliver credit support and loosen the flow of liquidity for small and medium-sized enterprises (SMEs) across the EU, including Wales.
Only last month, the EIB set aside a further €100 million over the next four years in a microfinance fund, to tackle unemployment in the EU by helping people who have recently lost their jobs, obtain start-up loans.
Back in February this year in the Assembly, Lesley Griffiths accused UK banks, of not doing enough to assist Welsh businesses during the downturn by failing to engage with the EIB in the help they were offering.
The AM is now writing to UK banks to find out to what extent they are co-operating with the EIB in its various schemes and what they are doing to inform their customers about what help is available from Brussels.
Commenting, Lesley Griffiths AM said:
“Since the global downturn began to bite, there have been constant and legitimate complaints by some small and medium sized companies in Wales about the difficulty they have faced in obtaining credit from their banks – credit that is vital in keeping their businesses afloat.
“One of the predominant reasons why firms fail during times like this, is due to a dearth of working capital and cash. That is precisely why the European Investment Bank has pulled out all of the stops in recent months, to make billions of Euros available in loans and guarantees to small companies – to get them through this rough patch.
“However, given the pan-EU nature of the various EIB schemes, they have had to be dependent on the co-operation of high-street lenders to get those loans and guarantees, out to business customers. I am not so sure UK banks have been co-operating fully and that is why I am anxious to find out to what extent, they have engaged with the EIB to date.
“I want to know from the banks, how they have made their Welsh SME customers aware of the EIB schemes and how much European money has actually flowed out to those firms in recent months. I await their answers with a great deal of interest.”
