The business secretary Peter Mandelson has unveiled a £20 billion credit plan with the aim of helping UK companies through the credit crunch and the recession, it has been reported.
Included in the package is a £10 billion working capital scheme, which will ensure bank lending to firms with a turnover of up to £500 million.
The Enterprise Finance Guarantee will also include a £1 billion export credit guarantee and a £50 million debt-for-equity fund.
Lord Mandelson said: "UK companies are the lifeblood of the economy and it is crucial that [the] government acts to provide real help."
However, shadow chancellor for the Conservatives George Osborne stated that the scheme reflected his party's own £50 billion loans guarantee package suggested in recent weeks.
He explained that he hoped the scheme would be properly implemented in order to avoid "repeating the mistakes of their expensive temporary VAT cut and achieving nothing".
The Bank of England has also been taking steps to lower the impact of the credit crunch and earlier in the month it slashed the base rate of interest to 1.5 per cent.
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