Cable on ‘business bank’ plans

BUSINESS Secretary Vince Cable has promised plans for a state-backed ‘business bank’ will involve more than a rebranding of current Government support schemes.

Final details for the bank, which would look to improve the flow of finance to small businesses, have yet to be announced amid suggestions the Treasury sees the idea merely as a way of making existing intitiatives more accessible.

Speaking to TheBusinessDesk.com he said: “There’s no question of the Government being directly involved in face to face lending.

“A lot of analysts have suggested there is a massive funding gap between what business will need in the recovery and the supply of finance that’s likely to be available from the banking system given the problems they have had with the crisis.

“The question is where that money comes from? The problem is mainly in the wholesale market. The Government can help with that, we are discussing what precise form of intervention we can make – Government money guarantees, the scale and scope of that we are trying to plot out at the moment but there is clearly a need and Government has a role.

“Its about interventions that will support the wholesale market and enable more funds to flow to business. They may be bank-funded, they may be non-bank funded.”