Government launches £20bn small business lending scheme

The government has launched a scheme to help small businesses access cheaper finance through discounts on loans.

Available to businesses with an annual group turnover of up to £50m, the National Loan Guarantee Scheme will give a discount of one percentage point on loans compared to the interest rate they would otherwise have received from that bank outside the scheme. Banks already committed to participating include Barclays, Santander, Lloyds and RBS. The plan is backed by £20bn of government guarantees on unsecured borrowing by the banks, with about £5bn in guarantees available in the first tranche. However, the government is not guaranteeing individual loans to businesses and, with banks reta...