max temp: 13°C

min temp: 11°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.

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.”

Search hundreds of local jobs at Jobs24


Felixstowe town centre looking busy and vibrant.

Two Suffolk communities have been praised for revitalising their high street “as a unique place for living, working and shopping”.

Lloyds has put aside £1bn for PPI compensation.

Lloyds Banking Group has set aside another £1bn to meet compensation claims for the mis-selling of payment protection insurance (PPI).

Daryl Johnson, General Manager at Bannatyne Bury St Edmunds, Anthony Elliott, Operations Director at Bannatyne Group, and Karen Wilkinson, Group Head of Spa for Bannatyne Group.

A Bury St Edmunds-based spa is celebrating a £375,000 facelift.

Solar panels at a solar farm. Half a million solar panels were installed every day last year, as renewables overtook coal to become the largest source of power capacity worldwide.

Half a million solar panels were installed every day last year, as renewables overtook coal to become the largest source of power worldwide.

Santander UK has reported a rise in profit.

Santander UK has reported a rise in profit, but again warned that earnings could take a hit as a result of Brexit.


Show Job Lists

Most read

Most commented

Topic pages


Newsletter Sign Up

Sign up to the following newsletters:

MyDate24 MyPhotos24