Ringfenced money will “help businesses to develop, grow and drive investment”
HSBC UK has unveiled a £500 million ringfenced fund for franchises, as the country looks to rebound from the COVID-19 crisis.
The money is part of a broader £15 billion lending fund to support UK small and medium-sized enterprises.
Funding of up to 70 per cent of start-up costs is available for franchisees joining an established network.
In addition, HSBC’s franchise team provide franchisees with a central helpdesk, offering advice and liaison with local banking managers.
Franchising numbers are at a record high in the UK, driven by the rise in younger people wishing to run their own businesses and existing franchisees expanding across sectors.
And despite the challenging economic environment, 62 per cent of UK businesses intend to increase investment in the next year, according to research from HSBC.
On top of this, 71 per cent of UK businesses expect to have returned to pre-pandemic levels of profitability by the end of 2022 and 20 per cent by the end of this year, while 49 per cent are projecting sales growth.
Andy Brattesani, head of franchise at HSBC UK, says: “2020 was a difficult year for businesses, with almost every sector impacted.
“Franchising is a great route towards expansion for an established, successful business looking to grow. Our £500 million fund will help businesses to develop, grow and drive investment.
“We know our customers are innovating and adapting at pace and British businesses tell us that through these uncertain times they need their bank to be flexible, provide funding when they need it most and support future growth opportunities - and that is exactly what the fund intends to achieve.”
Pip Wilkins, CEO of the British Franchise Association, says: “Through every economic downturn, franchising has continued to hold a solid share in the market.
“We have seen networks unite and use collective resources to survive impacts of the pandemic and many are now stronger businesses as a result.
“However, the industry would not be where it is today without the funding institutions such as HSBC UK.
“The £500 million SME fund for franchise businesses is a significant investment that will unlock the potential for thousands of people to grow in this diverse industry.”
Since launching the SME fund in 2014, HSBC has lent more than £75 billion to UK companies and over £14 billion during the pandemic so far.
Its Tomorrow Ready online resource hub is also available to help businesses hone their cash flow management skills and view HSBC’s programme of events, webinars and articles that aim to help them understand the implications of new ways of working, building resilience and exploring export opportunities.
Image owned by HSBC.