Osborne expected to unveil £40bn SMB lending scheme

Chancellor to take wraps off credit easing plan in autumn statement tomorrow

George Osborne is expected to unveil tomorrow a government-backed lending scheme that could be worth up to £40bn to UK plc.

The chancellor makes his eagerly awaited autumn statement tomorrow and one of its headline measures is expected to be a so-called credit easing scheme, designed to help retail banks lend money to SMBs. The package, the worth of which is estimated to be between £20bn and £40bn, allows banks to use the public purse to underwrite lending.

Osborne is also expected to take the wraps off an investment scheme backed by government and private investors. A bond-selling scheme, allowing smaller firms to publicly trade shares, is another credit easing initiative anticipated from the chancellor tomorrow.

The government's plans have been given a broadly warm reception by business groups. John Longworth, director general of the British Chambers of Commerce (BCC), called the credit easing plan a "big shot in the arm for Britain's real economy".

"As the BCC's latest economic forecast shows, the UK's prospects for growth remain shaky, and measures of this size and scale are urgently needed to sustain a credible recovery. Credit easing measures must be implemented quickly in order to boost business confidence and increase the flow of finance to viable and growing companies," he said.

Stay tuned to ChannelWeb tomorrow for a full rundown of the measures introduced in the autumn statement and analysis of what they mean for the channel.