George Osborne’s Budget has altered the SME funding landscape very little. For example, the £2k relief on National Insurance contributions paid by employers does not begin to operate until 2014 and the cut in corporation tax, down to 20% from 2015, will leave SMEs that are not yet profit-making enterprises unaffected.
However, businesses and entrepreneurs can expect the British Business Bank to begin investing. In the coming spring it will launch a £300m investment scheme that, alongside private investors, will invest in financial institutions and non-bank lending mechanisms with the purpose of expanding and diversifying the types of lending available to SMEs. Moreover, the British Business Bank will extend the Enterprise Capital Fund programme and develop the Business Angel Co-investment Fund in order to supply early-stage businesses with £75m of new venture capital.