(Reuters) - The British Business Bank will provide up to 100 million pounds of lending to small businesses and workers affected by Carillion Plc’s (CLLN.L) liquidation, the department for Business, Energy and Industrial Strategy (BEIS) said on Saturday.
The package will benefit businesses, including the construction and outsourcing company’s subcontractors who may not have sufficient assets as security for conventional loans.
Carillion’s 200-year-old business collapsed last month when its banks pulled the plug, triggering Britain’s biggest corporate failure in a decade and forcing the government to step in to guarantee public services from school meals to roadworks.
The banking sector’s trade body, UK Finance, has also confirmed an additional multi-million pound package for small businesses and personal banking customers, BEIS said.
“We want to signal very clearly to small and medium sized businesses who were owed money by Carillion that they will be supported to continue trading,” Business Secretary Greg Clark said in the statement.
The package is in addition to the range of measures already announced by Britain’s biggest banks including Lloyds Banking Group Plc (LLOY.L), HSBC Holdings Plc (HSBA.L) and Royal Bank of Scotland Group Plc (RBS.L).
Lloyds had said that it would make 50 million pounds available, while RBS and HSBC said they would open funds worth 75 million pounds and 100 million pounds respectively.
The banks had said any business customers experiencing financial difficulty as a result of Carillion’s collapse would be able to apply for payment holidays, fee support or, in the case of Lloyds, working capital.
Reporting by Abinaya Vijayaraghavan in Bengaluru. Editing by Jane Merriman