Small businesses are to be the beneficiaries after a taskforce of UK banks agreed to create a £1.5 billion fund to help provide them with capital.
Since the credit crisis, many small firms have struggled to secure the funding they need to see their businesses grow and, in some instances, even survive.
However, six major British banks have now committed to establishing the Business Growth Fund to 'fill a crucial gap in the market and provide capital for viable businesses which want to invest and grow'.
The Business Lending Taskforce, which is made up of the CEOs and senior representatives from Barclays, HSBC, Lloyds Banking Group, RBS, Santander, Standard Chartered and the British Bankers' Association (BBA), was set up in July to assess the problems small firms have faced in securing lending and to propose solutions.
The £1.5 billion fund is just one of 17 actions the taskforce has proposed in relation to improving customer relationships, ensuring better access to finance, providing better information and promoting understanding.
"As banks we have an obligation to help the UK economy return to growth," said John Varley, chief executive of Barclays and chairman of the taskforce.
"The private sector will play a key role in the recovery and it's our job to help viable firms to be successful. SMEs are particularly important as a source of job creation and growth."
BBA chief executive, Angela Knight, said the taskforce demonstrates the banks' commitment to helping their business customers.
"The proposals are substantial, wide-ranging and represent a real opportunity for the banks to provide finance, help and support both directly and through partnership with business organisations up and down the country," she added.
"Our members appreciate they have a role to play in supporting the UK economy and are determined to play their full part in the nation's economic recovery."
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