ROYAL BANK OF SCOTLAND, the country’s biggest lender to small businesses, will today try to head off government charges that banks are starving small and medium-sized enterprises (SMEs) of finance by launching an aggressive plan to bolster lending to the sector.

The three-pronged scheme comes a day before Alistair Darling is expected to unveil in his pre-budget report a radical, multi-billion-pound package of measures to prop up SMEs, which make up half the UK economy.

Under the plan, RBS will make a “price promise” not to increase rates on overdraft facilities for small business. It will also pledge not to withdraw existing facilities for 12 months from December 1.

In addition, the bank will deploy 500 local-relationship managers around the country who specialise in helping businesses manage with difficult conditions.

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