Many banks have committed to the Bank of England's (BoE) new Funding for Lending scheme (FLS), an official from the central institution has revealed.
Paul Fisher, a policymaker at the BoE, believes this initiative is on course to meet its target of boosting fluidity in the UK economy as financiers appear eager to participate.
Under the terms of the FLS, banks will be able to access loans with cost-effective interest rates from the BoE on the proviso that these savings are then passed on to consumers and businesses through their own lending arrangements.
And, during a speech delivered at London's Richmond University yesterday (25 September), Mr Fisher said he is "confident" the plan will work as the majority of the country's biggest financiers have already signed up.
He went on to say that the introduction of the FLS was vital as prior to its creation, "it was more likely than not that the stock of credit would contract further over the next 18 months".
By Asim Shah