Osborne to take wraps off credit-easing scheme

CHANCELLOR George Osborne will today announce details of his £20bn credit-easing scheme designed to help small businesses the day before he delivers the 2012 Budget.

The scheme will see the Government provide guarantees on unsecured borrowing by banks who will pass on the benefit to businesses with turnover below £50m.

Businesses that borrow through the National Loan Guarantee Scheme will be promised a one percentage point discount on the interest rate.

Mr Osborne said: “The Government promised to help small businesses get access to lower interest rates. Today, we deliver on that promise with a nationwide scheme.

“It’s only because we’ve earned credibility with our deficit reduction plan that we have low interest rates, and it’s only because of this scheme that we can pass the benefits of those low rates onto businesses.”

Barclays, Santander, Lloyds and RBS will offer the loans initially with Aldermore also having agreed in principle to be part of the scheme which was announced in the Autumn Statement.

The Government has said it will make a first round of guarantees worth £5bn available immediately with further rounds to be dictated by demand.

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