The investment will allow the specialist bank to increase its volume of lending to smaller businesses.

The £25m capital investment is being made under British Business Investments’ investment programme, which has so far committed over £800m to providers of UK SME finance.

Paul Lynam, CEO at Secure Trust Bank (pictured above), said its core SME operations had lent over £1bn directly to UK businesses and small housebuilders since 2015.

“As at June 2018, our real estate finance lending balances had grown to £705m from £541m a year earlier, representing our continued lending to professional landlords together with small- and medium-sized housebuilders for whom access to finance remains a major barrier. 

“Earlier this year, we announced that our invoice finance division had funded over £2bn in customer invoices since it began trading in 2014. 

“We are delighted to enter into this transaction with British Business Investments, which supports our ambitions to increase our lending – directly and indirectly – to UK businesses in the years ahead.”

Catherine Lewis La Torre, CEO at British Business Investments, said its investment in the specialist bank showed its continued commitment to increasing the diversity of smaller business finance in the UK.

“A diverse finance market means that smaller businesses benefit from more choices and better terms that increased competition can offer. 

“We believe our investment will not only help support Secure Trust Bank’s strong growth trajectory, but will also drive the bank’s ability to increase [its] lending to this important part of the finance market.”