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Pilot credit scheme helps construction trade

A pilot scheme involving Europe's largest home improvement retailer has helped 200 small businesses and sole traders in the construction industry to access more than £500 million worth of credit they would otherwise have struggled to secure.

The Kingfisher group - which includes Screwfix and B&Q's Tradepoint - launched an extension to the Government's Enterprise Finance Guarantee (EFG) scheme in April to make credit facilities available to small firms who have difficulty meeting the cost of materials upfront.

Under the EFG, the Government provides guarantees on up to 75 per cent of the value of a loan. These guarantees have allowed the Kingfisher group to offer:

  • up to £3,000 to new customers who would otherwise be denied access to a trade credit account
  • up to £25,000 to new customers who would otherwise have been subject to a £3,000 limit
  • up to £50,000 to existing customers who are seeking a higher limit than would otherwise be available according to existing criteria.

There has been interest in the scheme from a wide range of other business sectors.

Business and enterprise minister Michael Fallon commented: "The success of the pilot scheme is encouraging so far, and rolling it out amongst other builders merchants nationally and locally will boost confidence among our smallest traders in the construction industry."

Kingfisher plc's group chief executive, Ian Cheshire, said: "Smaller business such as these will be a vital engine of economic growth for the UK so I'm pleased that we're able to support that."