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Business groups welcome plans for state-backed small business bank

Business groups have welcomed Government proposals to introduce a new state-backed small business bank, in a bid to tackle the ongoing difficulties faced by small firms seeking credit.

The bank would not compete with existing commercial banks, and would operate online in the first instance, following the model of similar schemes in Germany, Ireland and the US.

John Walker, National Chairman of the Federation of Small Businesses, said, ‘With a third of businesses missing their growth opportunities as a result of not getting all the credit they need, we believe this bank will help firms grow and invest and get the recovery back on track’.

The British Chambers of Commerce (BCC) has recently been calling for the introduction of a state-backed business bank, in order to support the aspirations of new and fast-growing companies. The BCC commented that a strong business bank ‘would be the corner-stone of a truly business-friendly environment, helping to nurture Britain’s growth companies more sustainably and over the long term’.

Further details of the plans will be released later in the Autumn.