Business leaders welcome Government support for SMEs

BUSINESS leaders in the West Midlands have welcomed new measures from the Government to encourage growth in SMEs.

David Cameron said the measures, which include a £95m investment from the Regional Growth Fund, would support growth and create new jobs by enabling SMEs to export to new markets, secure finance and beat red tape.

The RGF funding will support firms considering investing in new capital assets and is expected to create at least 4,000 jobs and unlock around £500m of new investment.

The funding is being directed to small businesses through RBS, Natwest and HSBC. The fund uses the high street banks to provide finance for SMEs seeking to purchase assets and create employment, and which have been unable to secure funding elsewhere.

Bruce Undy, Warwickshire & Coventry chairman of the Federation of Small Businesses, said: “It is good news that some of the money from the RGF is now available to small firms – but we are disappointed that it looks like it will not be available to all businesses that need finance to grow.

“It is clear that grants will only be available to businesses that qualify for bank finance, but we still need greater clarity around the terms and conditions attached to the funding, the forms of business activity that are eligible for the grant and accompanying loan, and a clear indication of where in the UK this scheme will be available.”

He said the scheme needed to be communicated effectively to staff at branch level to avoid a repeat of the confusion that surrounded the introduction of the Enterprise Finance Guarantee.

The Birmingham Chamber of Commerce Group (BCCG) said it was pleased two of its patron members – RBS/Nat West and HSBC – would be playing a key role in the scheme.

RBS/Nat West will provide £70m and HSBC £25m. The banks will not profit financially from the administration of these schemes.

The chamber said small businesses which are currently unable to secure commercial funding for their projects now had the potential to benefit from government support through the banks’ regional networks.

Jerry Blackett, BCCG chief executive, said: “Through the banks and chamber networks, Birmingham, Burton, Chase, Lichfield, Tamworth and Solihull businesses will have the opportunity to invest in new capital assets, such as plant and machinery which in turn will create much needed new jobs.

“SMEs are the lifeblood of our economy and account for the vast majority of chamber membership.  We need to support them and help them expand and with this new initiative, backed by our patrons, businesses will be better able to grow their way out of these current economic difficulties.”