RBS to provide £750m challenger bank funding to boost SME business

The measures, proposed by the Treasury, is part of the bank's commitments agreed with the European Commission in 2009, and will see RBS create a fund which will be available for eligible challenger banks to help them incentivise SMEs to switch their accounts from RBS.

In addition, the bank will grant business customers of eligible challenger banks access to its branch network for cash and cheque handling, and an independent fund to invest in fintech to support the business banking of the future will be created. The bank has designated a £750 million provision for these measures, and noted that the reintegration of Williams & Glyn would 'likely create some additional restructuring charges during 2017 and 2018'.

Ross McEwan, RBS CEO, said:

 "Today's proposal would provide a path to increased competition in the SME market place. If agreed it would deliver an outcome on our EC State Aid divestment obligations more quickly and with more certainty than undertaking a difficult and complex sale and would provide much needed certainty for customers and staff."