Small businesses struggling to access finance received a boost today as the business secretary Vince Cable launched the first phase of the new business bank.
A total of £300 million will be invested alongside private investors to address gaps in the SME finance market. This money is the first deployment from the £1 billion of capital allocated to the business bank in the 2012 autumn statement.
Forum of Private Business head of policy Alex Jackman said: “Potentially some of this money can go out the door very quickly if proper proposals are submitted.
“There’s no doubt the money is desperately needed in the economy right now, so we urge the government to get the cash out to where it’s needed most, by working with organisations to ensure bids are successful.
“We certainly don’t want to be seeing any of this money sitting untouched come February next year.”
He added: “We must also remember that the New Business Bank won’t be entirely new lending; it will consolidate existing schemes, but we welcome this early new investment nonetheless.
“There’s a pressing need to target those businesses that have viable propositions but to which the banks won’t lend for oblique credit scoring reasons.
“So overall, while we welcome this news, the overriding message has to be that this money needs to be out the door fast, and not getting jammed in it.”