NatWest relaunched its small and medium-sized business (SMB) accelerator last week after shifting to an all-virtual model in response to the pandemic, per a press release. The incubator will give more than 1,400 UK businesses at various growth stages access to one-to-one coaching, a vast network of industry peers, and committed support from experts in their spaces. In addition to focusing on companies that are quickly scaling their operations, the bank is putting increased emphasis on sustainability as it vets new candidates. To be eligible for the program, businesses must be NatWest customers.
NatWest’s relaunch couldn’t come at a better time, as several UK neobanks have spent the past year acquiring SMB customers at a blistering pace. Here are two examples:
Government lending programs supercharged SMB expansion at neobanks, but NatWest’s more hands-on approach could help it better retain clients. Financial institutions large and small rode the wave of government relief programs to provide loans to struggling SMBs across the country. In a year marked by outsize pain and suffering for most, the accommodative policy was a silver lining for some UK neobanks, clearing the way for long sought-after profitable growth. The expansion could prove tenuous, however, if challengers lack the resources to imitate NatWest’s level of involvement once the tide of free money—and customers—recedes. Neobanks have looked to solidify their standing by integrating different components of business operations into a centralized hub but likely can’t match NatWest’s ability to provide personalized, one-to-one support—a service it just bolstered by adding 50 employees. Conversely, limited resources at challenger banks could make it harder for them to retain the record number of SMB customers they gained in the past year.