Leading the charge to net zero

‘Going green’ can seem like an expensive and complex process. While we’re seeing an unprecedented shift in the way many small and medium-sized enterprises (SMEs) feel about reducing emissions, there are still many barriers standing in their way according to NatWest’s head of business banking, Andrew Harrison.

As the UK’s largest business bank, NatWest has a duty to support the diverse and enterprising SME sector in its bid to tackle the looming challenge of climate change. As part of this commitment – and to support UK decarbonisation and the government’s net zero strategy – NatWest has pledged to provide £100 billion in climate and sustainable funding and financing to smaller businesses by the end of 2025.

Alongside financial support, we regularly conduct research with businesses to better understand the forces stopping them from taking those vital first steps towards going greener. Our most recent research, which took place in the wake of COP26, shows that reducing environmental impact is a priority for almost half (45 per cent) of smaller businesses in Britain. This positive attitude appears to be driven in part by shifting consumer demands, with over a third (37 per cent) of SMEs saying they believe their customers care about the environmental impact of the business. As a result, a further 44 per cent are already actively trying to make green changes to their businesses.

These findings tally with the NatWest ‘springboard to sustainable recovery’ report, which found that small businesses could deliver 50 per cent of the UK’s net zero decarbonisation goals (alongside a £160 billion growth opportunity) if they receive the necessary funding, training and access to information to do so.

As part of its £100 billion climate and sustainable funding promise, NatWest this month announced the launch of an arrangement fee-free green loan product which will help small and medium-sized businesses to achieve their sustainability ambitions.

These new green loans will drive forward change in the economy, helping SMEs to finance business assets as part of pioneering sustainability projects such as solar panels, electric vehicles, forest respiration or heat pumps on commercial buildings. The loans will provide opportunities for smaller businesses to grow sustainably and reflect the societal benefit of delivering climate action.

Applications for the loans are not limited to NatWest customers; the green loan proposition will be available across NatWest, Royal Bank of Scotland, and Ulster Bank NI brands, while the green asset finance will be available through the Lombard brand.

These green loans are the latest step for NatWest in its proactive role as a positive agent for change. They come alongside specialist accelerators for clean transport and circular economy, new tools for businesses to monitor their carbon footprints and mandatory climate training for all our relationship managers in collaboration with Universities of Cambridge and Edinburgh.

The power of small changes cannot be underestimated. NatWest pledges to stand by the UK’s small businesses to help them reduce emissions and explore exciting growth opportunities that move towards a green economy for everyone.

Find out more at www.natwest.com/climatehub

^{Green loans for qualifying SMEs are subject to the terms of a loan agreement, including that the loan must only be used for the applicable eligible purpose.}

^{Green Asset Finance for qualifying SMEs is subject to the terms of the finance agreement, including that the underlying asset must fall within the eligible asset list.}