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HSBC UK launches green finance range for SMEs

HSBC UK Commercial Bank has announced its latest offering of a variety of ‘green’ finance services to help support businesses looking to meet their environmental and sustainability goals.

The pilot was launched in November last year to large corporations with a loan amount of a minimum of £25 million.

“We have seen strong demand from businesses since launching the green loan pilot last year, so we are confident this suite of green finance products will support our customers to meet their sustainability agendas. Our customers are asking for more green finance products to support their specific ambitions,” said HSBC’s UK’s Head of Sustainable Finance, Rob King.

Indeed, the offering allows for customers to reveal their green credentials to their stakeholders outlining that a portion of their funding is dedicated to sustainability and environmental activities.

“Many stakeholders are now considering a company’s green credentials when making decisions about whether to work with, work for or invest in that company,” said King.

The new range offered by HSBC is now available for small to medium sized enterprises (SME), as well as large corporate enterprises. The offering comprises of a green loan, a green revolving credit facility (RCF), lease, asset loan, and a green hire purchase.

Green loans were introduced back in 2018 to large corporations when the minimum loan was £25m. However, as they have branched out and made the service available to SMEs, the minimum green loan starts at £300,000 which could essentially enable access to finance to a wide range of companies looking to initiate their own sustainability projects.

As part of a pilot, HSBC UK provided around £600m to businesses within the UK. Edwardian Hotels London was one of the enterprises which was granted the green loan. They took a loan of £175m to create its new “super boutique” hotel called ‘The Londoner, which aims to be one of the greenest hotels in the UK.  In fact, Edwardian Hotels London is the company in the hotels sector to obtain a green loan.

Green RCF allows for companies to gain access to funds depending on their sustainable cash flow needs. The minimum available loan is £1 million.

The UK government aims to lower its carbon emissions to zero by 2050 and in order to achieve this, sustainability will need to become a key priority to many companies.

“We can now support their [the government’s] aspirations through our comprehensive green lending propositions which supports businesses as they pursue sustainable and environmentally-focused activities, “said Amanda Murphy, Head of Commercial Banking at HSBC UK.

“This is part of HSBC’s global commitment to provide $100bn in sustainable financing and investment by 2025.”