Cameron launches £100m fund to create British “Mittelstand” » SMEInsider

Cameron launches £100m fund to create British “Mittelstand”

The UK should follow Germany’s example by building a thriving, family-run SME sector, says the Coalition government, using a new £100m fund to help plug the “lending gap”.

Called Help to Grow, the scheme would give a funding boost to the UK’s most rapidly growing firms. Support would come from the British Business Bank, which has said that current lending rates create a funding gap of £1bn a year.

One billion of opportunities – lost. One billion of new investment – missed,” said the Prime Minister during a speech at the British Chamber of Commerce Conference on Tuesday.

“We will plug this billion-pound gap by using the government’s balance sheet to guarantee loans by private lenders, or by co-investing public money alongside private money.”

A £100m pilot project will be launched in March to test the scheme.

“I want Britain to have its own version of the German ‘Mittelstand’ – a backbone of medium-sized firms which export, innovate and generate new jobs,” added Cameron.

“Our ambition is to help 500 of our fastest growing firms annually – giving entrepreneurs the access to the kind of finance their German equivalent would get.”