Wednesday 9 October 2019 6:22 pm

Government warned SMEs can’t live off ‘kind promises’ after Brexit finance council meeting

The Federation of Small Businesses (FSB) has said small businesses can’t “live off kind promises for the future” after the UK leaves the EU after the first meeting of a new finance council designed to support small and medium sized enterprises (SMEs) secure lending post-Brexit.

The finance council – made up of representatives from banks, other finance providers, government, and business – was created following criticism that SMEs were not being offered enough support in the run up to Brexit.

Read more: Small businesses need ‘meaningful financial assistance’ to prepare for no-deal Brexit, FSB warns

At its first meeting today, banks and other lenders agreed to five pledges outlining how they will support SMEs, including “confirming they are ‘open for business and ready to lend’”.

Other pledges include “Helping SMEs to prepare for Brexit and beyond by setting out the resources that they can provide”.

It has not yet been announced which lenders have signed the charter.

FSB policy and advocacy chairman Martin McTague, who attended the finance council, told City A.M.: “While the sentiment behind this charter is very noble, the proof will be in the pudding”

McTague said that SMEs had struggled to regain trust in big lendiers following the 2008 financial crash, adding: “a repeat of what occurred a decade ago could put it to bed forever.”

“Talk is often cheap. We need to see these kind words followed-up by actions in the present. We can’t live off kind promises for the future,” said McTague.

Business secretary Andrea Leadsom, who chairs the council, said access to finance was a “common cause of concern” for SMEs.

Read more: British businesses insert Brexit contingencies in supply contracts to prepare for no-deal

“We want to see the banks and lenders back our small and medium sized businesses, and this commitment is the first step in giving them the confidence they need to invest and grow,” Leadsom added.

Economic Secretary to the Treasury John Glen said he wants to see Britain’s SMEs “seize the opportunities of Brexit – expanding, creating jobs and boosting our economy”.

Main image credit: Getty