By Matt Falloon and Christina Fincher

LONDON (Reuters) - The Bank of England moved to ease the effects of a credit crunch on the banking system on Monday by offering to swap secure government bonds for riskier mortgage debt.

It is initially offering 50 billion pounds worth of gilt-edged securities but the size of the scheme will depend on how much banks need to get lending going again -- and how much they're willing to stump up in costly collateral.

"There is no arbitrary limit on it," Bank of England Governor Mervyn King told reporters.

Although the move should help to give some much-needed to support to the banking system, economists cautioned the swap scheme alone would not be enough to revive a flagging economy.

"It will have a positive impact on the money market but it's unlikely that it will have any meaningful impact on unlocking mortgage markets," said Lena Komileva, market economist at Tullett Prebon.

The Bank's plan is its latest move to deal with the impact of the credit crisis on the economy. Central banks around the world have been taking a variety of actions to get the frozen markets moving. The Federal Reserve last month unveiled a $200 billion (100 billion pound) scheme to help mortgage markets.

Since December the Bank has cut interest rates three times to 5.0 percent and provided emergency, mainly three month, liquidity to banks.

However, the government worries some of those rate cuts have not been passed on to consumers who, faced with rising oil and food prices and falling house prices, are starting to feel the effects of an economic downturn -- and who are increasingly disillusioned with Prime Minister Gordon Brown.