The Government's British Business Bank has made its first investments, giving £45 million to two firms in the hope of unlocking funding for small and medium-sized businesses.
Investment firms Praesidian Capital Europe and BMS Finance will be expected to use their allocations to provide debt finance of approximately £125 million through their new funds.
Under the plan, which Business Secretary Vince Cable said would help small firms secure vital finance, Praesidian Capital has been allocated £30 million and BMS Finance £15 million.
The money comes from the Government-owned bank's £300 million investment programme announced in April this year.
Mr Cable said: "Today we have set out a comprehensive package of measures that will address the concerns of small firms.
"The first investments from the British Business Bank's investment programme will provide choice to smaller businesses looking to secure vital finance to help invest.
"Alongside cutting red tape and increasing the take up of business rate relief, Government has already made significant progress in improving the business outlook for small firms and entrepreneurs."
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