Government boost for small firms

Updated: 
Lord HeseltineThe Government is to make £95 million available for investment by small and medium firms unable to obtain the funding they need in commercial loans from the banks.

The award of the grants, made from the Regional Growth Fund, will be administered by the Royal Bank of Scotland and HSBC in a deal brokered by former deputy prime minister Lord Heseltine.

Ministers estimate that the scheme will generate around £500 million of new investment in the SME (small and medium enterprise) sector, creating at least 4,000 jobs.

Launching the scheme at a business conference in London, Prime Minister David Cameron will hail it as a "huge step forward".
"Often it's a small investment - maybe just £30,000 - that can get those businesses going, create the jobs, kick-start the innovation and exports that we need," he is expected to say.

"But these are the very loans that you simply can't get without personal guarantees, like putting up your house - and even then the banks might say no.

"By using high street banks like this we will give support to those SMEs that can't access commercial funding and we will help areas of our country that other forms of business lending can't reach."
© 2011 Press Association