Loans for small British firms

LONDON – The British government announced a plan yesterday to ensure small- and medium-sized businesses can get access to credit.

The government will guarantee up to US$20 billion in bank loans to creditworthy business that are having trouble accessing capital because of the global credit crunch, Business Secretary Peter Mandelson said.
‘Their business models are not flawed, but the credit crunch has drastically reduced the amount of capital available, and banks have tightened their lending criteria,’ Mandelson said.
Mandelson said the plan would address businesses’ needs for cash flow, credit and capital.
The government guarantee will apply to loans, but can also be used by companies to convert existing overdrafts into loans.
‘We are offering specific solutions, not a blanket subsidy,’ he said. -Nampa-AP