A new £6million loan fund to support the growth of micro-businesses in Wales has been announced today by Business Minister Edwina Hart.
The new Fund is to be created as a direct response to the report of the Micro-Business Task and Finish Group, led by Institute of Directors Wales director Robert Lloyd Griffiths, which emphasised that access to finance is a key barrier to growth.
The report published in January this year recommended the Welsh Government facilitate accessible finance of between £1,000 and £20,000 for micro-businesses that are simple and reflect the level of investment required.
Mrs Hart said: “I am listening to business and welcomed the report from the Micro Business Group. It highlighted the significant contribution these enterprises make to the Welsh economy and the real difficulty they have in accessing the levels of finance needed to grow and invest and create jobs.
“I have therefore decided to set up a £6million Micro-Business Loan which will provide scope to support at least 300 businesses and anticipate it will become operational very early in the 2012/13 financial year.”
The £6m capital investment is specifically to support micro-businesses and the Welsh Government is in advanced discussions with Finance Wales regarding management of the fund.
Welcoming the news, Robert Lloyd Griffiths said: “This is really positive news. I’m delighted that the first of the Task and Finish Group’s recommendations – a very important one – has been taken on board by the Minister so soon after the presentation of our report.
“Micro-businesses around Wales told us that access to finance was a real key to success so I know this Fund will make a big difference.
“The Task and Finish Group was an independent body of private sector individuals and it’s encouraging to see the Minister engaging with the business community in this way.”
The new Micro-Business Loan follows the announcement by Mrs Hart this week (Tuesday February 28) that she is doubling the value of the Welsh Government’s Economic Growth Fund to £30million.
An additional £15million is to be provided to enable the Fund to support around another 70 companies who have already made applications, creating and safeguarding a further 1200 jobs over the next 14 months.
An update was also provided today to Assembly Members on the progress of the Youth Entrepreneurship Strategy (YES) Action Plan 2010-15 which raises awareness and develops entrepreneurial skills amongst young people and provides practical information and support for those seeking to start up in business.
The Written Statement reports that options on the delivery of a business mentoring service to Welsh SMEs is currently being drawn up. This links to the recommendation on developing a pan-Wales mentoring and coaching scheme made in the report produced by the Micro-Business Task and Finish Group.