Labour Guarantee Loans to Small Business
Tuesday, January 13, 2009 19:16
In order to boost the credit available to companies across the UK, the Government is now set to guarantee billions of pounds of loans to small companies in practice, which are businesses with 50 employees or fewer, which the taxpayer will end up underwriting if a firm goes bust.
It is understood that ministers will back about £20 billion of loans to small businesses. And the Conservative party is calling for a similar plan offering a £50 billion commitment. It is believed that the dither and delay of government has cost the jobs of many people because firms have gone bust.
Under the scheme suggested by the Consevertives, which is expected to be presented tomorrow, the Government could guarantee up to 95 per cent of a company’s loan. The move came into being as thousands of businesses are struggling to stay afloat as banks are limiting or stopping access to credit to minimise risk and protect their capital.
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