Banks receive $151m business lending boost

11 November 2011

British banks are to receive a financial boost from the government in order to encourage them to lend more to businesses following the recession.

Under plans unveiled by prime minister David Cameron, the Regional Growth Fund is to invest some £95 million ($151 million) in helping small and medium-sized enterprises (SMEs) access the finance they need to expand.

The Conservative-Liberal Democrat alliance sees such organisations as vital components in its plans to rejuvenate the country's economy - and it is hoped this injection of cash will make it easier for them to obtain funding from financiers.

Yesterday, a spokesman for the Project Merlin initiative insisted the major five banks taking part in the scheme are on track to meet their target of providing £190 billion in lending to businesses throughout 2011.

And Mr Cameron believes this additional cash should improve conditions further.

"British SMEs are already doing incredible things, but we urgently need more of them to follow that boldness," he added.

By Tony Aynsley

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