British Business Bank announces five-year plan for financing small UK firms

The British Business Bank (BBB) has published a five-year strategic plan for changing how smaller UK businesses are financed.

Earlier this year, the BBB was given an increased financial capacity of £25.6bn and more flexibility around how to deliver this.

The new five-year plan outlines how the bank will act through its investment and banking businesses, as well as its business development function, to:

Catalyse more capital: The BBB will increase its annual deployment by two thirds, unlocking around £26bn of private capital alongside £13bn of its funding, enabling up to £10bn in smaller business lending through guarantees
Take more risk: The BBB will take on additional risk, including through providing the first capital in deals that support emerging technologies where the UK can lead globally
Focus on scale-ups: It will target over 60 per cent of venture and venture-growth investment towards scale-ups, with the ability to write larger cheques (£100m or more) into the best growth-stage funds
Make more direct investments: It will increase the number and size of its investments so that strategically important scale-ups can raise domestic capital and grow
Unlock potential across the country: It will deliver 85,000 new start up loans and commit £150m to community development finance institutions to support underserved groups
Reform the Bank: The BBB will reform its governance and operating model, giving it greater licence to operate flexibly. It will also streamline its internal processes to make faster investment decisions.

“By 2030, our ambition is clear: a more dynamic and inclusive finance ecosystem, where innovative and ambitious companies – wherever they are based and whoever leads them – can access the capital they need not only to get started, but to scale, stay, and succeed here in the UK,” said Louis Taylor, chief executive of the BBB.

“Our small businesses have ambition and bright ideas in abundance, but too often they lack the finance they need to reach their full potential here in the UK, and as a result, our economy suffers,” added Peter Kyle, secretary of state for business and trade. “This has to change and with this new 5-year plan it will.”