Press Release: State aid: Commission approves two UK schemes easing SMEs access to credit

The European Commission has approved a UK measure, which aims at reducing the cost of finance for SMEs, until 30 June 2012.

The Commission found the National Loan Guarantee Scheme to be in line with the crisis State aid rules for banks, because it ensures that the reduced funding costs which banks will benefit from are passed on to SMEs. At the level of SMEs, the loans will not involve state aid within the meaning of EU rules. The Commission also cleared a second measure, the Business Finance Partnership, aimed at increasing the credit supply to SMEs through non-bank lending.

The Commission found that investments through the scheme will be made on equal terms with that of private lenders and that the management of the fund will be chosen through an open tender. The Commission therefore concluded that the latter scheme does not involve state aid within the meaning of EU rules.