Scottish Investment Bank to be expanded
Business Development Bank ‘to fill gap in SME finance’
The move is part of the commitment to create a Business Development Bank and will be backed by £21.5 million of new funding.
Scottish Enterprise has been asked to prepare a plan for creating the Business Development Bank services by expanding the remit of SIB and it will report back before the end of the Parliamentary session next month.
Deputy First Minister John Swinney said: “We made a commitment to improve access to finance for small and medium-sized businesses in Scotland, which have found it more difficult to gain access to funding in recent years.
“Small business is the engine of our economy and it is a national responsibility to try to provide an even playing field to help them grow.
‘The challenge we face is how to establish the most appropriate investment approach, given the UK Government accounting arrangements within which we are required to work, and ensure Scotland remains a strong, vibrant, diverse and opportunity-rich economy.”
Mr Swinney said the government was looking at “targeted approaches” to expand access to finance.
“I believe the best approach to creating the Scottish Business Development Bank is to enhance the remit of the Scottish Investment Bank (SIB) and for Scottish Enterprise to offer a wider range of business investment approaches, addressing some of the marketplace gaps to improve the supply of funding.
“Additional activity could include providing support to a broader number and range of businesses, offering and enabling loans, and potentially guarantees, alongside equity products, and providing an enhanced financial readiness service.
“Our approach will help to ensure support for company growth, particularly to scale up existing small companies to become the medium and larger enterprises Scotland needs, as well as increasing exporting, innovation, and investment and supporting the business finance market to work more effectively.”
“The establishment of the Business Development Bank will augment the offering available to companies right across Scotland and we look forward to working with both public sector bodies and private sector providers to deliver this ambition,” she said.
The decision to enhance SIB’s remit comes alongside other moves, such as the Scottish Government’s recent launch of public procurement for a £40m Fund to distribute ERDF monies to SMEs, through funding providers.
Taken together, these are part of the broader Scottish Business Development Bank approach, including wider Scottish Government and public agency finance initiatives for SMEs.
These actions follow the publication of a joint report on The Market for SME Finance in Scotland, by the Scottish Government, Scottish Enterprise and Highlands and Islands Enterprise, which highlighted the significant gaps in the Scottish marketplace for business funding for SMEs.
- The Scottish Government will invest up to £63.8 million in Dundee’s Waterfront, as part of a package agreed today by John Swinney and Dundee City Council.
The Growth Accelerator model (GA), developed by the Scottish Futures Trust, is designed to stimulate growth, create jobs and support businesses through a combination of public and private sector investment in local infrastructure and public spaces.
Funding is linked to the delivery of agreed outcomes and will be targeted towards improvements to Dundee railway station concourse, development of the V&A and ensuring the Waterfront boasts world class digital infrastructure. 4,500 square metres of Grade A office space will also be developed alongside improvements to civic spaces.
Welcoming the agreement, Mr Swinney said: “Our existing infrastructure investment programme is already working to improve connectivity and stimulate economic growth. Through projects like the V&A we are also enhancing the cultural offerings, which are key to creating the right environment for attracting investment.
“The GA model continues to be explored in other cities and regions to unlock further investment across Scotland, and I look forward to receiving any proposals in due course.”
Cllr Ken Guild, Leader of Dundee City Council said: “Today’s announcement is the key to unlocking increased funding for one of the most exciting and innovative projects currently going on in Scotland.
Tony Rose, infrastructure director at the Scottish Futures Trust, said: “Building on our pathfinding work with The City of Edinburgh Council, I’m delighted that Dundee City Council is using our innovative Growth Accelerator which will unlock and deliver substantial economic growth across the City, both during and after construction.”