Govt announces £25m business lending extension

Date: 13th May 2009

An extra £25 million is to be released through the government's enterprise finance guarantee (EFG) scheme, it has been announced.

Through the extension, Community Development Finance Institutions (CDFIs) will be given access to banks loans worth up to £20 million which can then be used to support business communities.

Additionally, Unity Trust Bank will provide £5 million in new lending as part of the scheme.

For more information on how to access finance under the EFG, managers should speak with their local accountant.

Lord Mandelson, secretary of state for business, said: "[CDFIs] are an increasingly important source of finance and investment for small businesses and social enterprises that have been unable to access finance from banks."

He added that they played "an extremely important role" in helping small firms in disadvantaged parts of the UK.

From this month the government has also launched its own trade credit insurance top-up scheme, which aims to protect small companies against defaulted payments.