PROJECT Merlin might be floundering – the agreement under which the major banks agree to lend to small and medium sized firms (SMEs) – but Lex is stepping in to get small businesses into new company cars and business vans.
Lex Autolease, which is part of the banking group Lloyds, has decided to put some financial muscle into the SME market and says it wants to increase its funding to SMEs by 20% over the next three years.
This will come as a welcome relief to those SMEs scratching around to find additional finance. According to the the Federation of Small Businesses (FSB), the number of small businesses that have used a bank overdraft or loan has fallen in the past two years.
Lex says it already has an established relationship with the SME sector – it currently funds 75,000 business cars and vans to the tune of £750m, but the plan is to up this level of SME funding to £900m by 2014/15.
“In line with our ongoing commitment to SMEs, we’re actually looking to grow our core small fleet business by at least 20% over the next few years,” said Andrew Kirby, director of SME sales at Lex Autolease.
“We recognise that transport is one of the key building blocks of growth and want to help mobilise more SMEs and their employees. We intend to play an active part in lending to smaller firms, especially those with a similar approach to business as ours.
“We’re interesting in acquiring a customer, not a one-off transaction, so it’s important our relationship will be a long term one and that we both share the same mutual interest in quality customer service.”
Typical finance products small fleets can expect are contract hire and personal contract hire as well as contract purchase. Lex Autolease is the largest leasing company in the UK with a total fleet size of 280,000 business cars and business vans.
Kirby said that 25% of the total Lex fleet was accounted for by the SME market alone.