RBS to review Enterprise Finance Guarantee scheme

Following discussions with the British Business Bank (BBB) – the body established by Government that manages the scheme - the bank decided it was appropriate to examine a sample of EFG customer files. This exercise identified a number of instances where we have not properly explained to customers how borrower and guarantor liabilities work under the EFG scheme. We will now be implementing a thorough and proactive review of affected and potentially affected customers to ensure they are put back in the position they believed they would have been in.

We remain supportive of the EFG scheme which has enabled us to lend to thousands of businesses who would not otherwise have been able to access bank finance, and in doing so, have safeguarded jobs and helped to contribute to the economic recovery. EFG continues to have an important role to play and RBS remains committed to the scheme.

Alison Rose, CEO Commercial and Private Banking said, “EFG is a hugely important scheme that has helped many businesses continue to trade today. This is why it is so important that our staff adhere to the highest standards to ensure that customers fully understand the features of the product. I am not satisfied that we have met those standards in all cases.

Following discussions with the BBB, we have taken action to put this right. We have now made sure that EFG loans will always be given appropriately. We are implementing a thorough and proactive review of affected, and potentially affected, customers. Any customers that have been affected will be contacted directly by the bank to ensure they are put back in the position they believed they would have been in.”

If you have any questions or concerns please contact 0345 835 5478.

Alison Rose, CEO Commercial and Private Banking. 

What is EFG?

The Enterprise Finance Guarantee (EFG) is a government lending initiative for small businesses with viable business proposals that lack security for conventional lending.

What is the size of RBS’ involvement in the scheme?

We are the industry leader in offering the EFG scheme which has enabled us to lend over £900m to 9,000 small businesses across the UK, that otherwise would not have been able to access finance due to a lack of available security.

What has come to light today?

RBS has recently undertaken a review to examine whether we clearly explained borrower and guarantor liabilities to EFG customers. Regrettably, the results of the review of a sample of cases have confirmed that, based on statistical analysis of our sample, there are instances where the bank’s explanation did not meet our standards.

What is RBS doing as a result of these findings?

RBS is acting swiftly and robustly to ensure neither our customers nor the Government are adversely impacted by the issues identified. We have already made a number of improvements to our systems to ensure that new customers understand the scheme features. In addition, we are implementing a thorough review of EFG customers that are likely to have been impacted. The review is being led by a team of specialists and are cooperating fully with the BBB and relevant stakeholders.

Who can I contact if I think I have been impacted by this?

If you have any questions or concerns please contact 0345 835 5478.