Banking on Essex Launches

Banking on Essex is the first major municipal banking scheme to be created since 1915 and will see Essex County Council (ECC and Abbey Corporate Banking) make available an initial £30 million of new liquidity in loans and overdrafts to viable local businesses through the creation of dedicated credit facilities. The scheme is in direct response to the recession and is designed to support small and medium sized enterprises within Essex currently struggling to access funding through high street providers.

Loans and overdrafts of up to £100,000 will be available for eligible Essex businesses employing less than 250 people, with a turnover of less than £25m and who have been trading for at least 12 months.

The loans will be handled through a unique partnership between the authority and Abbey Corporate Banking, part of the Santander banking group. The bank will provide the credit and process capability to the partnership, together with a full banking infrastructure.

Businesses wishing to apply for funding should visit www.bankingonessex.com for details on how to apply.

Lord Hanningfield, leader of Essex County Council said:
"This is one of the most fundamental changes in how either our financial or governance systems operates and represents a huge shift away from an over centralised model back to a local system responsive to the needs of local businesses and their communities.

"The bedrock of the Essex economy, like much of the UK, is made up of small businesses that have been struggling in recent months to secure funding through normal lenders. This scheme will fill that gap directly benefiting those companies and providing them with much needed support during the downturn.

"From one of the most centralised models in world, in Essex at least, we are willing to do things differently if it benefits our local communities. I am of course proud that the county is once again leading the way."

Shaun Kelly, Head of Business Development at Abbey Corporate Banking said:
“This innovative agreement with Essex County Council is a strong signal from one of the strongest and best capitalised banks in the world that we are open for business and keen to support the SME sector in the UK. The Banking on Essex scheme will provide a lifeline to many businesses in the region, that are not only encountering challenges in their own business but are also finding their banking facilities being repriced or withdrawn with little consideration to the wider or historic relationship.

“We see this as the start of a relationship journey along which our aim is to provide a breadth of financial solutions to our shared clients. We are delighted to be part of this scheme and are currently talking to other local authorities about similar schemes.”

The scheme has also won support from the British Chambers of Commerce, British Bankers Association and the Local Government Association.

ECC is making a total of £50 million available from its cash balances.