Extension of UK business finance scheme approved
Wednesday 27 June 2012
The European Commission approved, on 26 June, the prolongation, until 31 December 2012, of a UK state aid scheme that aims to reduce the cost of finance for businesses with turnover of up to around €300 million. The British credit easing scheme was originally limited to small and medium-sized enterprises with turnover of up to €60 million and approved by the Commission on 14 March. Various changes have been made to it with respect to eligible firms, the minimum allocation of guarantees to banks, foreign currency issuance, etc. The Commission found that, even with the changes, the scheme is still in line with state aid rules for the banking sector during the crisis. The measure constitutes a response to growing tension on sovereign debt markets that has made it hard to obtain access to long-term funding.