Essex businesses are soon to be thrown a lifeline with the development of a new bank just for small businesses. The credit crunch has meant that many small businesses have been unable to obtain loans, even when their order books are looking healthy. This has often meant that companies cannot purchase the raw materials to enable them to meet orders. Businesses that would normally be healthy are suffering due to the credit crunch, not due to lack of trade, but lack of cash flow.
Essex County Council plans to set aside £50m for loans of up to £100,000 for small and medium-sized businesses, which have been trading for at least one year. Essex County Council are currently finalising plans to set up a Bank of Essex, which will provide a central point for accessing European funds available to aid small businesses. The plan also includes the creation of Essex Savers as a new credit union and an Essex Apprentice Scheme.
Lord Hanningfield, leader of Essex County Council, said the Bank of Essex is inspired by the American model, which has many regional banks.
“We want to try to support businesses in difficult times. The situation in Essex for the next year does not look good. If the banks won’t help them, someone has to.” Lord Hanningfield
More news is expected soon, as Essex County Council and Lord Hanningfield are keen to drive this initiative forward. Throughout 2008-2009 Essex authorities are investing nearly £1bn in the county’s economy, helping local businesses to survive and succeed during the economic crisis. Hopefully the Bank of Essex will be established in 2010 to lead Essex out of recession. This is just another reminder of how well placed Essex is to dig its way out of the economic crisis.