Fund title: British Business Bank – unlocking finance for smaller businesses
Focus of fund/fund aims:
The British Business Bank is being set up as an economic development bank to create more effective and efficient finance markets for smaller businesses in the UK.
The British Business Bank has been set up to unlock finance for smaller businesses. It is expected to become an arms-length government-owned institution next year but, in the meantime, it is being run directly by government, offering funding to non-bank finance providers and information, advice and signposting to small businesses seeking finance. The British Business Bank will consolidate many of the government’s existing business finance schemes, as well as an extra £1 billion of funding.
A key objective of the British Business Bank is to address the limited choice of finance for small businesses by funding alternative providers. For example, seven finance providers have so far been supported through the BBB’s Business Finance Partnership and are now offering finance, through a range of different models, to Small and Medium-sized Enterprises (SMEs).
For SMEs – the new British Business Bank website explains the pros and cons of the different types of funding and financing available to SMEs, including:
- factoring and invoice discounting
- supply chain finance
- secured and unsecured loans
- leasing and asset finance
- equity finance
SMEs can also use the http://www.businessfinanceforyou.co.uk/ tool to identify the most suitable type of funding for their business.
For finance providers – the Investment Programme addresses long-standing gaps in the finance market for smaller business and promotes greater choice in their supply of lending. It makes commercial investments, alongside private-sector investors, in equity, debt funds and other financing mechanisms.