Rachel Reeves to unveil billions in loans for small businesses in final act
Rachel Reeves is set to announce a significant expansion of financial support for small and medium-sized businesses (SMEs) in what is expected to be one of her final acts as Chancellor.
Tuesday’s “swan song” Mansion House speech will detail plans to boost British businesses.
The flagship measure includes a significant increase in the Growth Guarantee Scheme (GGS), which provides a 70 percent government guarantee on commercial loans.
GGS has provided over £3.7 billion in funding to SMEs since its launch in 2022.
The Chancellor’s proposals would add £6.5bn to a scheme set by the British Business Bank to support 33,000 businesses across the UK over the next three years.
Loan terms will extend from six to ten years and eligibility will be extended to businesses with a turnover of £45 million to £54 million.
Ms Reeves said: “Our plan for the economy has put Britain on a stronger footing – restoring stability, ensuring investment flows and delivering reforms. We know small businesses are the backbone of this economy and growth in all our regions, and for too long they have heard the word ‘no’ as they try to raise the funds they need to grow and create jobs across the UK. When they succeed, we all succeed, and today’s major reforms are the most important step in years to unlock their potential.”
The announcement comes as Ms Reeves conceded she will no longer be Chancellor and Andy Burnham, who has emerged as the sole candidate in Labour’s leadership contest, is expected to become prime minister as early as July 20.
Ed Miliband and Yvette Cooper are among the names put forward as potential successors. Ms Reeves will also announce new financial support for businesses to export their goods and services abroad.
Business Secretary Peter Kyle said: “Today we’re throwing our weight behind Britain’s entrepreneurs and innovators, unlocking billions of dollars of additional credit to help thousands more small businesses start, scale and succeed, because access to finance should never be the barrier between a good idea and it becoming a great British business.”
These reforms aim to address long-standing challenges faced by small businesses in accessing finance, creating an environment conducive to investment, job creation and sustainable economic growth across the country.
