According to Mark Hoban MP, Financial Secretary to the Treasury, bringing these measures into force a year early is a demonstration of the Government’s commitment to help UK SMEs access the finance they need.
Small firms will now be able to raise equity finance up to €5m before a costly prospectus must be produced. This rate has been doubled and the number of investors allowed to be targeted has also gone up from 100 to 150.
Mr Hoban said: "I’m delighted to announce that the UK is taking the lead in Europe by introducing these deregulatory measures early, saving UK SMEs £12 million per year. Reducing the regulatory burdens faced by business is vital in making the UK the best place in Europe to start, finance and grow a company."
"In order to play their part in the wider economic recovery, small businesses have to be able to access the finance they need - that includes making it easier for such businesses to tap into capital markets,” he added.
The news has been welcomed by business owners and analysts alike. And John Walker, National Chairman of the Federation of Small Businesses, said:
"We welcome the fact that the Government is leading the way in Europe by making it easier for small business to access finance. More small firms should look at equity finance as an alternative route to accessing credit, and these simple changes will help firms who are looking to grow and invest."
"Extending the number of investors and increasing the prospectus value will help more small businesses access equity finance and show there are more options than just going to the bank for credit. What’s important is that small businesses are aware of the alternative routes to finance," he added.
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