The UK must address a ‘structural failure' in business finance if it is to develop domestic equivalents to the likes of Google or Samsung, according to the British Chambers of Commerce (BCC).
BCC director John Longworth said many firms are unable to secure the financing necessary to grow beyond being small businesses and has urged the government to address what he says is a structural failure when it comes to securing "patient finance."
He said: "There is a long-term, structural failure in business finance in the UK, made worse by the banking crisis, and this hampers our ability to nurture a British Samsung or Google.
"Too often, UK businesses on this journey are ‘hoovered up' by private equity, corporates and international competitors, which can reduce their wealth creation potential and concentrate decision making outside the UK."
Longworth is positive on the impact of overseas investment but has stressed the importance of finding ways to for the UK to become a "national incubator" for firms looking to realise long-term growth ambitions.
The Bank of England announced an extension to the Funding for Lending scheme in April, which allows participants to borrow until January 2015, with incentives to boost lending skewed towards small and medium sized enterprises.
In November, the Bank announced the extension would be re-focused away from mortgages in 2014 in order to solely support business lending.
Bank of England executive director for markets Paul Fisher said in December that the latest data for the FLS showed lending to small and medium-sized businesses remained subdued.
He said: "An economic recovery has taken hold... But credit supply to businesses remains relatively subdued, especially to SMEs. The refocus of the FLS is designed to continue to support the recovery, where it is needed."
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