Banks Unveil Loan Rejection Appeal Scheme For Small Firms

Tue, 05 Apr 2011

Britain's major banks have launched a new initiative aimed at giving small and medium-sized businesses (SMEs) the power to challenge decisions to turn down their loan applications .

On Monday HSBC, Barclays, Royal Bank of Scotland, Lloyds Banking Group, and Santander unveiled a scheme to ensure any decision to turn down business loan requests from SMEs will be reviewed by a more senior person within the bank.

Under the Better Business Finance initiative, lenders will also have to provide businesses with the result of a loan appeal within 30 days along with information on alternative sources of finance if the appeal is rejected.

The British Bankers Association (BBA) said the campaign was one of a number of new schemes being introduced to help make lending to SMEs more transparent.

Announcing the move in Edinburgh yesterday, BBA chief executive Angela Knight said: "The Better Business Finance campaign represents the banking industry's continued commitment to providing small and medium-sized businesses with the information and support that they need."

In addition to the new appeals process, she said banks were also introducing mentors, for free, to help small firms with their loan applications .
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