Small and medium-sized businesses (SMBs) in the capital will benefit from a new public fund designed to help them access credit, it has been claimed.
Andrew Palmer, director for London at the Confederation of British Industry (CBI), welcomed news of a £40 million fund to encourage jobs and growth, announced by Boris Johnson last week.
"With youth unemployment in London too high, it’s encouraging to see the Mayor backing skills development and job creation in some of the capital’s most vibrant sectors," he stated.
Mr Palmer said the focus on supporting SMBs to "overcome the hurdle of accessing finance" will help them to grow and fulfil their potential.
The new funding comes as part of proposals to invest the second tranche of a £111 million fund provided by the government for the London economy, reports the BBC.
According to the news provider, the Mayor of London has so far spent only £2 million of the £70 million available to his London Enterprise Panel in the first tranche.
Mr Johnson said SMBs would be some of the principle beneficiaries of the fund, which will enable "significant support" for SMBs.
"[This is] just one way we are working to unlock potential and provide jobs for our growing city," he stated.
The new funding plan has also been welcomed by the Federation of Small Businesses (FSB).
Steve Warwick, regional chairman for London, said the credit crunch has meant that many businesses have struggled to get the finance that they need to operate their enterprise effectively.
"Our research shows that five in ten businesses in London were turned down for a loan or overdraft in the first quarter of 2013," he stated.
"This needs to be addressed as a matter of urgency, which is why it is vital that the scheme announced today is attached to the soon to be created Business Bank which will house a myriad of similar funds."
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Posted by Steve Williams