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£700m funding boost for small firms

The European Investment Bank has granted approval for over £700m in funding to be given to small businesses across the UK.

The UK banks that are, or have been, involved in the EIB scheme include Bank of Scotland, Barclays, Close Brothers, Lloyds TSB, Royal Bank of Scotland, Santander UK and Ulster Bank.

The Treasury says this will help nearly 3,000 small firms.

At the 2008 Pre-Budget Report the government announced that small and medium sized enterprises could benefit from up to £4bn of EIB finance between 2008-2011.

In the first year the target was for UK banks to secure £1bn of finance for SMEs from the EIB.

The Treasury says this target was met and that banks have now secured a total of £1.39bn from the EIB.

Ian Pearson MP, economic secretary to the Treasury, says: “Support for SMEs is key to driving growth in the UK, so I am delighted that small businesses are benefiting from this finance.

“This forms part of the government’s continued commitment to help SMEs access the finance they need to take their businesses forward, which is vital to our long-term growth strategy.”

Simon Brooks, vice-president of the EIB, says: “The EIB’s ongoing support for small and medium sized enterprises in the UK through cheaper, simpler and more flexible loans will enable increased investment to expand business opportunities and create new jobs in difficult times.

“We wish to encourage continued contact between firms and partner banks to allow more companies to benefit from the extensive financial support available.”

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