Economy: Credit Easing Policy

Baroness Kramer Excerpts

Thursday 26th April 2012 Lords Chamber

[Lord Myners]

My Lords—

[Baroness Kramer]

My Lords—

[Noble Lords]

This side!

[Baroness Kramer]

My Lords, the noble Lord very kindly gave way and I appreciate it.

Perhaps I may suggest to the Government that they missed an opportunity in this round of credit easing by not including community development financial institutions, which, after all, serve micro and small businesses considered unbankable by the big five. Will the Government reconsider and see if a tranche could be made available under this round, or certainly under future rounds?

[Lord Sassoon]

I am grateful to my noble friend, who rightly comes back to this issue, which is important. We have certainly extended the reach of the present scheme beyond previous comparable schemes. For example, the NLGS includes asset-backed finance, which other schemes have not in the past; we have the non-bank finance schemes, through the business finance partnership; and we have one non-traditional big bank—Aldermore—which is in principle committed to the NLGS. So we are pushing out the boundaries. As to the specific question about CDFIs, as my noble friend may be aware, the banks, under the BBA’s better finance initiative, are putting in place procedures to make sure that banks formally pass customers whom they think appropriate towards CDFIs. That is an important step which the BBA has initiated.