Funding for Scottish SMEs to be made easier

The finance options and support available to Scottish small and medium-sized enterprises (SMEs) has been explored in a new Scottish government report.

‘The Market for SME finance in Scotland’ report highlights that Scottish SMEs enjoy the benefits from extensive business banking services, a vibrant angel investment community and on-going public sector actions that allow many firms to access the funding they require to develop their businesses.

However, the report does see some room for improvement in allowing some firms to get access to the funding they require, and examines how other European countries implement the scheme.

Fundamental elements of the Scottish government’s approach to supporting the SME finance market are set out in the paper and include plans to simplify the current funding process for SMEs.

Existing finance options will also look to be expanded upon including the co-investment funds provided by the Scottish Investment Bank, the Scottish Loan Fund and the Local Authority loan funds, to identify new streams of finance that can be used to increase the levels of funding available to Scottish SMEs.

The establishment of a Scottish Business Development Bank, which will look to bring new sources of finance to Scotland, will also press ahead.

Deputy First Minister John Swinney said: “Small and medium-sized enterprises are not only the backbone of the Scottish economy, but are essential to delivering our ambition, as set out in Scotland’s Economic Strategy, to build a more productive, innovative and fairer Scotland.

“Along with our Enterprise Agency and Local Authority partners, we are already taking forward a range of actions to address gaps in both the supply of and demand for finance.

“The Scottish Investment Bank is providing equity investment alongside private sector partners to support early-stage innovative companies’ access risk capital investment and have recently streamlined and enhanced their Funds to make them more flexible and increase their impact. Local authority loan funds provide loans to small and growing businesses that cannot attract all the funding they seek from private sector funders.

“We are also providing a range of financial advice and support, including direct financial readiness support for companies looking to raise finance through the Scottish Investment Bank.

“We will continue to explore all possible avenues to make it as straightforward as possible for SMEs across Scotland to access the funding they require to pursue opportunities in international markets, create jobs and generate inclusive growth.”

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