The Government will announce today that its new British Business Bank will receive a further £250m to lend to small businesses, taking the total available to £1.25bn.
The new bank is based in Sheffield and has been set up to get money flowing into small and medium-sized businesses as fast as possible to help them expand after many complained that the traditional banks were not lending to them.
The money will be used to support a range of initiatives, including capital support for venture capital and other investment groups.
Nick Clegg, Deputy Prime Minister, is due to announce the additional funding in west London today. He said: “Small businesses are working hard to fuel our recovery and help us build a stronger economy. I am determined that we do all we can to help companies that have struggled to get the investment they need. Investment that means they can employ those extra people, take on that new order, and buy new equipment.”
Vince Cable, Business Secretary, added that the British Business Bank “is a new long-term institution which is helping to create more competition in the banking sector and give access to finance to businesses who are currently struggling with high-street banks, to get the cash they need to invest in their future growth”.
The British Business Bank was launched in October and has so far made commitments as part of its investment programme totalling £35m.
Britain has 4.9 million small and medium-sized businesses. They account for 99.9 per cent of all private-sector businesses in the UK.