Crucial funding could not have been better timed
Business investment is an important tool to support growth and help drive economic growth in the region.
At a time when finance and credit availability are being tightened, the first investments from Finance Yorkshire could not have come at a better time. With £90 million available to be invested over the next four years, the Fund is a real shot in the arm for many small and medium sized enterprises across Yorkshire, the Humber and North and North East Lincolnshire.
To ensure that deals are made, the continued support of intermediaries such as accountants, business advisers and banks is essential, both to identify potential clients and sign-post them in the direction of Finance Yorkshire as well as working closely with the Fund to complete deals. These partnerships proved successful with the previous two funds - South Yorkshire Investment Fund and Partnership Investment Finance - and will be crucial in giving the financial market some much needed stimulation.
A big issue for businesses is still the reluctance of banks to lend. Banks will say that there is not enough demand, while companies would say that demand is there but they are charging too much. It’s a complex debate and Finance Yorkshire may be able to assist and fill the lending gap.
It is vital that we work closely with the banks and our hope is that we will co-fund in some cases with them. The outcome of this will be that we can open more doors for businesses and particularly open more doors for banks that may be prepared to co-lend helping to kick-start the market.
Despite investments only starting in August, so far we have already invested nearly £900,000 in 18 deals ranging from Sheffield printers, J.W. Northend to Fresh Pastures, a Wakefield company that supplies milk and other morning products to schools and councils, to a new Sheffield start-up who required funding to help bring down the cost of high-capacity batteries which will make electric vehicles more practical. It’s a clear indication of how Finance Yorkshire can play a key role in boosting economic growth in this region.
Lasting for four years, it is estimated that the Fund will help to create or safeguard almost 6,000 jobs and create £602million of gross value added for Yorkshire’s economy.
Seedcorn, loan and equity linked investments, ranging from £15,000 to £2million are available to help small and medium businesses meet the gaps in funding they need for growth and development. Seedcorn finance is available up to £780,000, business loans of up to £150,000 are available and equity-linked finance can be accessed in the £100,000 to £2m range.
The project is supported financially by the European Union. It has attracted £30million investment from the European Regional Development Fund (ERDF) as part of Europe’s support for the region’s economic development through the Yorkshire and Humber ERDF Programme, £15million from Yorkshire Forward’s Single Programme, and £45million match funding from the European Investment Bank.
For more information about Finance Yorkshire, please visit www.finance-yorkshire.com or ring 0845 649 0000.
Note: this news article is from Finance Yorkshire’s previous fund. Read more about Finance Yorkshire