Partner Article

Government opens bidding for £500m funding scheme

The Government is today opening up a further £500 million of credit easing funds and is inviting bidders to manage the fund aimed at easing cash flow for struggling businesses.

Fund managers are being invited to bid for rights to manage £400 million investments, which will be used to lend to businesses with an annual turnover of less than £500 million. The remaining £100 million will be invested via non-traditional funding streams for smaller firms.

Seven shortlisted loan fund managers have already been selected to look after the first £700 million tranche, which is targeted at medium-sized firms.

The remaining £20 billion credit easing package has been allocated to the national loan guarantee scheme, which aims to reduce risks for banks and will allow more businesses to secure funding for expansion.

The Government scheme recently came under fire from critics who feel that the scheme has had little impact on the UK economy. The coalition is now facing calls for bolder steps to be taken to secure the recovery in light of the worsening Eurozone situation.

This was posted in Bdaily's Members' News section by Ruth Mitchell .