New £150 Million Fund Supports Investment in the Leisure & Tourism Sector
In May 2013 NatWest and RBS launched a £150million loan fund to support investment by SME businesses in the leisure and tourism sector.
The launch of the Leisure Fund, which was designed after consultation with VisitEngland, follows publication of research by the two banks, which shows that one in four UK leisure businesses feel they are losing out to competitors due to lack of investment.
The survey of SMEs across the leisure industry showed 30% of respondents did not feel they had invested sufficiently in 2012 to remain competitive, but 55% believed investment in refurbishment or new equipment would make a positive impact on their business.
However, when asked how optimistic they felt about 2013, 48% of those surveyed believed their business would grow in the next year, with 73% of those saying they were either optimistic or very optimistic about 2013.
The new fund will allow leisure and tourism businesses to take out loans of between £100,000 and £10 million. There is no arrangement fee and the loans can be taken over a term of up to five years. Loans from the fund offer the borrower the option of two capital repayment holidays, which may be taken at any time during the loan term – apart from the first twelve months.
Another key issue for the industry is the impact of adverse weather. The survey reveals that 74% of the businesses surveyed have not made any additional allowances for bad weather conditions this summer – despite nearly half of respondents noting July and August as their most profitable months. On announcing the fund NatWest and RBS suggested that leisure and tourism businesses might consider taking out a loan in order to “weather proof” their venues given the problems a wet summer can bring.
Leisure and tourism is a key industry for the UK, generating around £97bn of GDP and providing nearly two million jobs.