£20 million Wales Capital Growth Fund will help Welsh SMEs target larger contracts
2 Apr 2014 12:48 PM
A new £20 million fund that will provide
Welsh small and medium-sized businesses (SMEs) with the backing they need to
bid for larger contracts has been announced by Economy Minister, Edwina
Hart.
The
Wales Capital Growth Fund, which has been funded by the Welsh Government and
will be managed by Finance Wales, has been created in response to demand from
Welsh SMEs for finance for a range of short-term working capital and
performance bond requirements.
Welsh SMEs will now be able to apply for loans of
between £50,000 and £2 million for terms of up to 18 months from
the five-year fund. It aims to help up to ninety SMEs and it is anticipated it
will potentially create and safeguard around 1000 jobs over a five year
period.
The
Fund will facilitate stock purchasing, project finance and also provide short
term loans to SMEs to provide cash collateral to support performance bonds
issued by banks for domestic and export contracts. The ‘evergreen’
fund will operate on a commercial basis and, by recycling investment returns,
has the potential to make finance of up to £60 million available over
five years. It will complement other funds managed by Finance Wales, such as
the Wales JEREMIE and SME Investment Funds, which make long-term growth
investments.
The
Minister said:
”The Fund demonstrates the Welsh
Government’s commitment to encouraging business growth and meets a
funding gap identified by Finance Wales. It will provide much needed access to
finance for SMEs that cannot currently access working capital and bonding
finance from the banking market. Many Welsh businesses have the capability and
capacity to secure new contracts and now, thanks to the Wales Capital Growth
Fund, they can also finance the working capital they need or the performance
bonds that are often required.”
Loans from the Wales Capital Growth Fund can be used for
a range of short-term funding needs often associated with larger contracts.
This can include one-off debtor finance, stock purchases and project finance as
well as to provide security for advanced-payment, performance and warranty
bonds.
Businesses wishing to apply for investment from the fund should contact Finance
Wales on 0800 587 4140 or visit their website for more
information.
Websites
Finance
Wales