£60m small business scheme launched through Regional Growth Fund

The CDFA will receive £30 million from the Government’s Regional Growth Fund (RGF) which has been matched with a further £30 million by the Co-operative Bank and Unity Trust Bank to provide lending to small, micro and social enterprises.

The funding is expected to create or safeguard over 8,000 jobs over six years across the country and meet some of the growing demand from small businesses for access to finance and drive investment in often fragmented communities.

To see how future projects will be supported through RGF, Vince Cable visited Utensa, a bakeware firm in Tyseley, Birmingham which has already received a loan from the Aston Reinvestment Trust (ART) – a Community Development Finance Institution (CDFI) and member of the CDFA.

The £30,000 loan has helped Utensa develop its manufacturing facility to improve its competitiveness with the Far East as well as safeguarding jobs for the future and creating jobs for two new machine operators at the company.

The visit was followed by Vince Cable giving the keynote speech at the CDFA’s annual conference in Solihull where the Business Secretary set out the important role that CDFIs have in providing credit to under-served markets.

Speaking at the conference, Business Secretary Vince Cable said: “We need effective channels to support small business which is why the CDFA and its members are so important for providing access to finance and kick starting the economy. They are best placed to ensure that the £60 million goes to those SMEs, such as Utensa in Birmingham, that will create jobs and unlock private investment.

“Regional Growth Fund programmes like this one have already awarded SMEs over 500 grants and loans across the country. This is an excellent way to get value for money, but more importantly, it is a good way to focus on local priorities for growth, as most programmes are led by local partners. RGF is leading the way in rebalancing the economy and boosting business and industry.”

Ben Hughes, Chief Executive of the CDFA said: “We welcome the £60m invested by RGF and Co-operative Bank/Unity Trust Bank into our unique RGF programme. Through creating 8,000 jobs in some of the most deprived areas of England, it offers remarkable value for money in boosting sustainable local growth.

“This investment is critical to the survival of many small and micro businesses who, without this support, would simply not exist. It’s a milestone, yet just the starting point for an exciting – and timely – expansion of the community finance sector; greater investment like this offers a new way of creating wealth – that’s sustainable and ethical yet that also makes sound business sense.”