This is by Nick Broom, of Preview

I had a laughable meeting this week with my Natwest bank manager - Despite demonstrating two established and profitable businesses that have run for 10 and 15 years respectively, with no previous borrowings, it counted for nothing whatsoever in their view - I was told that an application to obtain even a small working capital or overdraft facility would not be considered without personal guarantee. I was also told that even if I applied under the governments much lauded Enterprise Finance Guarantee Scheme (EFG), despite the government guaranteeing 75% of the loan, the bank would still insist on a personal guarantee. And, to add insult to injury, I would have to pay almost 4% over base rate for the pleasure.

I understand that the banks need to protect their (our?!) money, but it is much like closing the gate after the horse has bolted in the current climate! I am also somewhat astonished that the trading record and heritage of an established business seems to count for nothing. It is also at complete odds with the fact that you can (for example) get a loan of around £20k from the AA completely unsecured, and at a good rate! Fortunately for us we can work without the facility, but it does beg the question, what is the point of a bank?

I am very interested to hear what other business owners experiences of their banks have been of late.


Nick Broom
Founding Director, Preview