Overcast

Overcast

max temp: 11°C

min temp: 8°C

ESTD 1874 Search

UK: East of England firms ‘benefit least’ from finance scheme for small firms

09:00 21 February 2013

Business and Enterprise Minister Michael Fallon

Business and Enterprise Minister Michael Fallon

Businesses in the East of England are amongst those benefiting least from a scheme to give small firms access to finance.

shares

The Enterprise Finance Guarantee (EFG), introduced in 2009 in response to the credit crunch, sees the Treasury act as guarantor on 75pc of individual bank loans between £1000 and £1m to small and medium sized firms finding it hard to access a commercial loan.

But a report carried out by academics for the Department for Business, Innovation and Skills (BIS) showed firms in the east had not participated as much as other areas.

In the Eastern region 14.7 firms in every 10,000 had gained finance through EFG, compared to 17 in the West Midlands, 16.8 in the East Midlands, 16.6 in the South East, 16.4 in the North East and 16 in the North West.

Firms in Wales and Scotland also received finance through the EFG more than businesses in the east. Meanwhile companies in Yorkshire, the South East and London used the initiative less.

Chris Starkie is programme manager at the New Anglia Local Enterprise Partnership, a grouping of council and business leaders from East Anglia.

He said: “We are encouraging businesses to challenge the banks to ask them for finance and also not to assume that they are going to say ‘no’.

“Ensuring business can access finance is an important priority for us, that’s why next month we’ll be launching our business growth fund that will provide grant finance for expanding firms.”

The BIS study suggested EFG added £1.1bn to the UK economy overall, and that for every £1 invested it had helped deliver £33.50 in output.

Meanwhile the researchers, from the University of Durham, argued it had created 6,500 jobs and safeguarded more than 12,000 across the UK.

They suggested lower rates of participation in the East could be because it was more prosperous are with businesses having better access to conventional bank lending.

But business minister Michael Fallon admitted further pressure needed to be exerted to ensure the initiative performed well in all areas.

He said: “Clearly the demand is there for this type of financial support so we must start to see an increase in take-up.

“I have already begun publishing EFG lending by each individual bank, because businesses should know which bank they are best off approaching and I will continue holding the banks to account until lending levels improve.”

shares

0 comments

Sainsbury's chief executive Mike Coupe.
Photo: Sainsbury's/PA Wire

The City will this week look for details of how Sainsbury’s plans to overhaul Argos when the supermarket posts its annual results next week, while trading at rival Morrisons and banking giant HSBC will also be in the spotlight.

Avanti supports CLIC Sargent charity

Networking group getting Muddy and wiggy for young cancer patients

Nick and Kim Hoare from Ivy Grange Farm near Halesworth who run a glamping site with five yurts.
Photo: Nick Butcher

A glamping firm hoping to banish memories of sodden sleeping bags and leaking tents is catching the eye of campers after an upmarket break.

Royal Bank of Scotland has reported a sharp increase in first quarter losses.

Royal Bank of Scotland has reported a first-quarter pre-tax loss of £968million, more than double last year’s figure of £446m.

Tom Boother is running from Land's End to John O'Groats in aid of EACH and Great Ormond Street. Marquis Suffolk is lending Tom a motorhome for him to sleep in during the challenge.

Tom’s charity challenge - running 816 miles from Land’s End to John O’Groats

Most read

Great Days Out

cover

Click here to view
the Great Days Out
supplement

View
HOT JOBS

Show Job Lists

Streetlife

Newsletter Sign Up

Great British Life

Great British Life
MyDate24 MyPhotos24