4R Blog

RSS Feed

Chancellor to unveil £20bn business lending boost

Date Added: 28/11/2011  

Firms in need of company debt advice could be about to receive a boost by the news the coalition government is to make £20 billion available in a bid to improve business lending.

In his autumn statement to be revealed later in the week, chancellor George Osborne is set to announce a credit easing scheme that will see banks' debts underwritten.

In theory, this will allow them to open up the flow of lending to businesses once more and give the green light to loans with a lower level of interest rates.

It is hoped this will have the result of growth in the private sector and the creation of jobs to support the UK's economy as it struggles to recover from the recession.

The chancellor appeared on the BBC's Andrew Marr show yesterday (November 27th) to talk about the plans and said it will be a "low risk" to the coalition government.

"We are making available £20 billion for the National Loan Guarantee Scheme; however, it sits within an envelope that could be as large as £40 billion," he said.

The Conservative MP for Tatton added: "These are guarantees. We are not borrowing this money; we are underwriting the loans that are being made."

Shadow chancellor Ed Balls told Andrew Marr he supports the business lending scheme in principal, but will need to see the plans in more detail in the coming weeks.

He claimed it could turn out to be similar to the small firms guarantee scheme that has been in operation for the last five years and was introduced by the previous Labour administration.

Last week, Lloyds TSB revealed that it is set to make £12 billion available in order to improve business lending figures in a bid to beat targets set for it by the coalition government as part of the Project Merlin deal that was agreed to improve the flow of credit to small companies, the Evening Gazette reported.

Need advice on Winding up Orders? Call 0800 9020123

Posted by Michael Beam 

Get the Help You Deserve

0800 90 20 123

Urgent Help Call 24/7

020 7183 2606

We'll Call You

Request a Callback