NatWest is to provide an additional £1bn in lending to the UK manufacturing sector by the end of 2030. The bank says the aim is to stimulate growth in the sector. Specifically, NatWest said it wants to help manufacturers invest in cleaner, more efficient forms of energy generation and use. Bank support takes the form of lending deployed through loans, asset finance, and overdrafts.

The assets, activities and companies eligible for this £1bn lending are those aligned with NatWest’s Climate and Sustainable Funding and Financing Inclusion Criteria.

Manufacturing in the UK is responsible for nearly 10% of total economic output, and over 8% of all employment. However, it is a significant contributor to greenhouse gas emissions. Over 12% of the UK total is attributed to the sector.

NatWest support includes lending, partnerships and tailored financial advice

With the industry likely to remain energy intensive, NatWest is aiming to offer support those in the sector that includes lending, partnerships and tailored financial advice.

The bank is also partnering with Warwick Manufacturing Group (WMG). It will pilot, with customers the opportunity to join their Business Energy Aid Toolkit programme. This identifies the energy use involved in their business’ processes and production. The programme then recommends actions to reduce emissions, alongside estimates of the impact these would have on overall emissions. Businesses who have completed the programme to date report minimum energy savings of 12%, with an average saving of 21%.

The bank also offers its free Carbon Planner tool. Businesses can measure their carbon footprint and build a plan to reduce their emissions on a simple online portal.

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Delivering change at scale

Alison Rose, CEO, NatWest Group and Co-chair of UK Energy Efficiency Task Force said: “NatWest is proud to be a leading bank for UK business and a major supporter of the manufacturing sector across the country. Manufacturing is a significant contributor to both the economy and UK carbon emissions. So, it’s important that businesses are supported to transition to cleaner, more sustainable operations in a positive way. One where the benefits outweigh the costs. That’s why we aim to provide an additional £1billion of lending to help businesses in transitioning to a net-zero economy.

As part of my role on the UK Energy Efficiency Task Force, it has become clear that the best way of delivering change at scale is through public and private sectors working together. For NatWest, that starts with helping businesses move forward in an informed and supported way.”

David Greenwood, CEO, WMG added: “The UK has committed to reduce energy demand by 15%, from 2021 levels, by 2030. UK manufacturers are continuing to experience prohibitively high energy costs. This significantly effects their ability to be competitive in global markets.  In partnership with NatWest, WMG are helping UK manufacturing to deliver both economic benefits as well as environmental benefits.”

As noted in the latest RBI digimag, the future of the retail banking sector will be shaped by a range of disruptive themes, with environmental, social, and governance (ESG) one of the key themes that will have a significant impact on retail banking companies.

“There is a growing desire to hold companies accountable for ESG performance across their value chains. But it goes beyond emissions to the impact on communities, workers and the local environment. The impact will not be confined to heavy industries and big polluters. All businesses must be aware of the growing significance of ESG and the risks and opportunities that come with it.” Cyrus Mewawalla, head of thematic intelligence, GlobalData