Fast-track loans proving vital for small businesses
SOME 73 small businesses in Wales has accessed more than £1.3m of fast-track micro loans from the Development Bank of Wales to date in its current financial year.
The funding is an increase of more than 30% compared to the same period in 2020 when fast-track loans totalled £986,000.
The funding figures are based on April to December last year, which falls within the development bank’s current financial year to the end of March 2022.
The development bank said this showed there was appetite from small businesses for growth capital to invest as the economy recovers from the pandemic.
The £30m Wales micro loan fund is financed by the Welsh Government. Loans between £1,000 and £50,000 are available with repayments terms ranging between one and 10 years.
The scheme is open to small businesses, sole traders and social enterprises that have been trading in Wales for over two years.
They can apply for a fast-track micro loan of up to £25,000 from the Development Bank of Wales. Decisions on qualifying customer loans can be made within two working days.
Recipients of the fast-track loans have included an 18th century inn, a Spanish tapas bar and an African food store.
Nicola Edwards, micro loans fund manager of the Development Bank of Wales, said: “Now more than ever, businesses need quick and easy access to sustainable and flexible finance to help them invest in the future. Those in catering and hospitality have had a particularly difficult time over the last two years, while many tradespeople are looking for funding to help their recovery and growth.”
She added: “It’s testament to the dedication and future ambition of
business owners across all sectors in Wales that so many have come forward to get the funding that they need to invest in their businesses, scale up and accelerate growth.”
Carmarthen-based Cutting Edge Mechanics received a fast-track loan of £25,000 to take advantage of new dealership opportunities with the purchase of stock and a trailer.
Established in 2016 by owner Alun James, the business is an independent stockist and repairer of specialist arborist and gardening equipment.
Mr James said: “The opportunity arose to take on a new dealership. £25,000 is a lot of money to find as a small business, so getting a quick decision on a loan from the development bank was just what we needed.
“It was an easy and straight-for
ward process which meant that I could get the order placed with the dealers and agree the purchase of a new trailer quickly.”
Ele’s Little Kitchen, a Spanish food catering company based in Gorseinon, near Swansea, was first set up from home to cater for parties, business events and weddings.
An £8,000 fast-track loan has enabled owner Elena Pardo to relocate to new restaurant premises on High Street, Gorseinon.
The popular tapas bar now offers both take-away and delivery.
African food store SunBim Foods in Newport now makes African baked goods on site after securing a £12,000 fast-track loan which was used to purchase an industrial oven.
Owner Sunday Omuju said: “Access
to finance has been really important for us as we couldn’t invest in the business without the support of the development bank. We’re also very grateful that they made the application process so easy and quick. It’s made a massive difference.”
Tafarn y Waen, an 18th century inn near St Asaph, received a £20,000 loan which has been used to diversify income by renovating the remote pub into a boutique guesthouse. A small caravan site has also been created.
Co-owner Elaine Molloy said: “The money has enabled us to diversify and future-proof the business with investment in our accommodation.
“We’ve created an attractive destination that will secure the long-term survival of Tafarn y Waen as an historic, rural establishment.”