British Business bank launches first £120m tranche of Midlands Engine Investment Fund
£120m of debt finance and small business loans launched as part of wider £250m Midlands Engine Investment Fund
- Fund launched alongside new report on state of Midlands economy
- Report highlights potential of Midlands’ smaller businesses to drive regional growth
The British Business Bank has today announced the first wave of its £250m Midlands Engine Investment Fund, with the launch of £120million worth of SME debt finance, in a move designed to provide greater support to the region’s smaller businesses, accelerate economic growth and promote job creation – in line with the Government’s Midlands Engine Strategy.
The fund’s launch has been marked with the publication of a new report on the current state of the regional economy and funding landscape. Spotlight: The Midlands Engine Investment Fund, draws on the British Business Bank’s own research together with other publicly-available data. It highlights the opportunities for ambitious, fast-growth businesses across the Midlands Engine area to reach their economic potential.
The report highlights how the MEIF will unlock the potential of the region’s small businesses, while detailing the current economic strengths and parameters of the region:
- The Midlands economy contributes 13% of the UK’s economic output
- 14% of all high-growth businesses are located in the region
- Five-year business survival rate is higher in the East and West Midlands than in London
The Midlands Engine Investment Fund will play a vital role in fuelling regional growth. It is the result of close collaboration between the British Business Bank, the Department for Business, Energy and Industrial Strategy, the Department for Communities and Local Government and 10 Local Enterprise Partnerships (LEPs) in the East & South East Midlands and West Midlands. It brings together new and existing funding from Central Government, the European Regional Development Fund (ERDF), British Business Bank and European Investment Bank (EIB).
The £120million fund is composed of two separate lots – £30million of small business loans valued at £25,000 to £150,000, as well as £90million of debt finance worth £100,000 to £1.5million. The £120million fund is part of a wider £250million commitment, with further funding to be made available in due course.
Sajid Javid, SECRETARY OF STATE FOR COMMUNITIES AND LOCAL GOVERNMENT and Midlands Engine Ministerial Champion said:
“The investment fund is a key part of our Midlands Engine Strategy to help create more jobs and boost skills in the region. This financial support will enable local businesses to grow, move in to new markets and boost productivity.”
Greg Clark, SECRETARY OF STATE FOR BUSINESS, ENERGY AND INDUSTRIAL STRATEGY commented:
“The UK is a world leader in business and innovation. This is why we want all corners of the country to experience the benefits of enterprise, growth and jobs created by new businesses. The Midlands Engine Investment Fund is an important part of our modern Industrial Strategy, which will help entrepreneurs across the thriving Midlands region access the funding and support they need to start, grow and invest in their future.”
Patrick Magee, Chief Commercial Officer at the British Business Bank said:
“The MEIF will play a pivotal role in plugging in the gaps currently present in the small business funding landscape, ensuring that all businesses have access to the finance they need to grow. Currently, younger small businesses and those looking to scale up, the very businesses that have the greatest potential for job creation, are more likely to have their applications for external finance rejected. We want to mobilise these businesses, supporting organisations of varying sizes and stages of development across the Midlands.”
For more information on how to access finance from the MEIF and on the nature of funds available, visit the MEIF Website. The British Business Bank’s latest Spotlight Report, which provides an overview of the Midlands business landscape can be found here.
The Midlands Engine Investment Fund project is supported financially by the European Union using funding from the European Regional Development Fund (ERDF) as part of the European Structural and Investment Funds Growth Programme 2014-2020 and the European Investment Bank.
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NOTES TO EDITORS
About the Midlands Engine Investment Fund
The Midlands Engine Investment Fund will invest in Debt Finance, Small Business Loans, Proof of Concept and Equity Finance funds, ranging from £25,000 to £2m, specifically to help small and medium sized businesses secure the funding they need for growth and development.
The Midlands Engine Investment Fund is operated by British Business Financial Services Limited, wholly owned by British Business Bank, the UK’s national economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity.
The Midlands Engine Investment Fund is supported by the European Regional Development Fund, the European Investment Bank, the Department for Business, Energy and Industrial Strategy and British Business Finance Limited, a British Business Bank group company.
The MEIF covers the following LEP areas: Black Country, Coventry & Warwickshire, Greater Birmingham & Solihull, Stoke-on-Trent and Staffordshire, The Marches, and Worcestershire in the West Midlands; and Derby, Derbyshire, Nottingham & Nottinghamshire (D2N2) Greater Lincolnshire, Leicester and Leicestershire, and South East Midlands in the East & South East Midlands.
The project is receiving up to £78,550,000 of funding from the England European Regional Development Fund as part of the European Structural and Investment Funds Growth Programme 2014-2020. The Department for Communities and Local Government is the Managing Authority for European Regional Development Fund. Established by the European Union, the European Regional Development Fund helps local areas stimulate their economic development by investing in projects which will support innovation, businesses, create jobs and local community regenerations. For more information visit www.gov.uk/european-growth-funding.
The funds in which Midlands Engine Investment Fund invests are open to businesses with material operations, or planning to open material operations, in the West Midlands and East & South East Midlands.
The British Business Bank has published the Business Finance Guide (in partnership with the ICAEW, and a further 21 business and finance organisations). The guide, which impartially sets out the range finance options available to businesses and provides links to support available at a regional level, is available at www.thebusinessfinanceguide.co.uk
About the British Business Bank
The British Business Bank is the UK’s national economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity. Our remit is to design, deliver and efficiently manage UK-wide smaller business access to finance programmes for the UK government.
The British Business Bank programmes are already supporting almost 3.4bn of finance to more than 59,000 smaller businesses, through over 100 finance partners. They are participating in a further £5.8bn finance to small mid-cap businesses (as at end of August 2017).
British Business Bank plc is a limited company registered in England and Wales, registration number 08616013, registered office at Foundry House, 3 Millsands, Sheffield, S3 8NH.
As the holding company of the group operating under the trading name of British Business Bank, it is a development bank wholly owned by HM Government which is not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). The British Business Bank operates under its own brand name through a number of subsidiaries, one of which is authorised and regulated by the FCA.
British Business Bank plc and its principal operating subsidiaries are not banking institutions and do not operate as such. A complete legal structure chart for British Business Bank plc and its subsidiaries can be found on the British Business Bank plc website.