The government is set to unveil a scheme to help small and medium sized businesses obtain credit insurance.
The move, which is expected to be included in the next budget, has been made after concerns that many supply chains were under threat from the reduced availability of credit insurance. For many businesses, the lack of insurance meant reduced credit facilities or having them removed entirely.
According to the Financial Times, the scheme is targeted at medium-risk businesses and is not expected to offer guarantees for those companies that have seen credit cover completely withdrawn.
“Supply chains have undoubtedly been hit by the withdrawal and reduction of credit insurance facilities. If implemented, a government guarantee scheme will help to ease the difficult conditions that small and medium-sized firms are operating in,” said the director general of the British Chamber of Commerce, David Frost.
“It is crucial that any scheme is quickly and efficiently implemented so that struggling companies can take advantage of it as soon as possible. It will be business that drives us out of recession, so supporting them through this downturn is crucial.”