Who is offering the RLS?
The new iteration of the recovery loan scheme (RLS) is almost four months old now and 38 lenders have been approved to deliver the scheme so far.
These 38 accredited lenders include major banking brands such as HSBC, Barclays and Lloyds, alongside a mix of alternative lenders, business lenders and challenger banks.
However, at the time of writing no peer-to-peer lending platforms have been authorised to deliver the government-lending scheme.
So who is actually offering RLS loans?
- The banks
As well as HSBC, Barclays and Lloyds, Danske Bank, Bank of Scotland, Natwest, Santander, RBS and Ulster Bank have all been accredited under the scheme. This is no surprise, given that these banks all took part in the previous iteration of the RLS, as well as the other government-backed lending schemes which were set up in the early days of the pandemic.
Challenger bank Atom Bank was one of the first to be accredited for the new RLS, but former P2P lender Zopa Bank has not made the list. Earlier this month, Zopa Bank signalled that it was eyeing a move into small- and medium-sized enterprise (SME) lending which may make it a more suitable candidate for RLS and similar schemes in the future.
Read more: BBB has delivered £12.2bn to 96,000 SMEs
- Business lenders
Many of the accredited RLS lenders are specialist business lending firms, which makes sense for a scheme which is specifically aimed at providing business finance. BCRS Business Loans, First Enterprise, Finance for Enterprise, and Business Enterprise Fund are just a few of the firms selected to offer the RLS.
Peer2Peer Finance News is aware that in August, former P2P lender Funding Circle was working with the government towards becoming RLS accredited. However, the business lender has not yet made the list.
- Alternative lenders
While no P2P lenders have been selected to deliver the RLS just yet, a number of other alternative lenders have gained accreditation. These include Time Finance, which provides asset finance, invoice finance, loans and vehicle finance.
Cornwall’s Swig Finance was a recent addition to the RLS lender list – it provides funding to SMEs and start-ups in the south east of the country.
Hire purchase specialist Simply has also won accreditation, alongside alternative lender Tower Leasing, which covers all aspects of equipment leasing and business finance.
The new iteration of the RLS is set to run for two years, and aims to help SMEs access cheaper funding as they recover from the Covid-19 pandemic. Accredited lenders can offer loans of up to £2m, or up to £1m for firms from Northern Ireland.
The government will underwrite 70 per cent of the value of each loan and the annual rate of interest and fees cannot be more than 14.99 per cent.
Read more: CapitalRise secures funding line with Downing