Brokers arranged larger loans for RLS last year but demand is low

Brokers are arranging larger finance requests under the recovery loan scheme (RLS) compared with its predecessors but demand for RLS loans is comparatively lower.

The National Association of Commercial Finance Brokers’ (NACFB) annual member survey for 2021 found the average size RLS facility stood at £539,281 – more than twice the size of the typical coronavirus business interruption loans arranged in 2020.

However, NACFB members said engagement with the RLS was lower than expected, with only 11 deals per brokerage.

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Half of members said the main reason for reduced scheme activity was a lack of direct RLS enquiries, while 16 per cent said their clients simply did not meet the scheme’s criteria.

The survey found that NACFB members helped originate £40.9bn of borrowing by small- and medium-sized enterprises last year.

The average size loan size was £458,582, up 17 per cent annually and surpassing 2019’s figure of £450,145.

“The data proves what we in the industry have long known, which is just how vital the intermediary-led route to market is for the UK’s 5.6 million SMEs,” Paul Goodman, chair of the NACFB, said.

“The trade body continues to forge stronger and deeper cross-party relationships within Government, as well as the British Business Bank and the Bank of England.

“We will engage with any stakeholder that needs to know more about the essential work NACFB members undertake.”

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