Capify Announces £40 Million Fund in Response to UK SMBs’ Difficulties

Seeing small and medium-sized businesses (SMBs) in the U.K. buffeted by inflation and struggling to get financing from traditional lending sources, specialist SMB lender Capify has announced a £40 million fund for businesses that need a lifeline or want to invest and grow.

Funding of up to £500,000 will be open to SMBs, and the offer was trigged by growing concern about access to finance, rising prices across the supply chain and some SMBs’ aims to boost sales and increase hiring despite these conditions, FinTech Global reported Monday (Aug. 8).

“As we saw in that last great recession, traditional banks restrict their lending criteria in uncertain times and make it difficult for [SMBs] to get the finance they so desperately need,” Capify COO John Rozenbroek said in the report. “Our new fund is a specific response to this gap in the funding landscape.”

The online retail sector that boomed in the U.K. during the pandemic has suffered from a wave of closures since the government eased COVID-19 restrictions, the Office for National Statistics said in a July 28 report.

Read more: Wave of eCommerce Flops Behind Record 113,700 UK Business Closures in Q2

The number of retail firms shutting down rose 40% year over year in the second quarter, according to the report.

As for the country’s banks, PYMNTS reported that during the most recent earnings season for the U.K.’s “Big Four” banks — Barclays, HSBC, Lloyds and NatWest— they reported no cataclysmic losses despite taking a stock market beating at the beginning of March and seeing mounting geopolitical tensions.

See also: Mounting Losses, SMBs and Digital Banking Define UK Big Four Performance in H1 2022

Barclays and Lloyds reported a year-on-year decline in profits for the first half of the year (H1), while NatWest and HSBC saw their profits increase during the period.

During NatWest’s H1 results presentation, Group CEO Alison Rose highlighted SMBs, saying, “We’re also helping smaller businesses with green loans to help them buy solar panels, electric vehicles and heat pumps.”

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