Prior to the Budget statement yesterday (22nd November), the British Business Bank had £3.7bn of UK government funding.

This has now been increased to £6.2bn.

The funding will unlock up to an additional £13bn of equity finance to support UK SMEs.

The increase in funding comes from the recommendations of HM Treasury's patient capital review, which received expert backing from an industry panel led by Damon Buffini.

The British Business Bank's patient capital initiatives aim to develop a “patient ecosystem” so that high-growth potential UK companies can access sufficient long-term finance.

The measures implemented are expected to boost UK productivity by helping firms with the ambition to scale up access the funding they need to fully achieve their growth potential.

Patient capital will be increased through three means:

• A new £2.5bn 'British patient capital' entity will invest commercially into venture and growth capital, but with significant extra resources.

• British Business Investments – the bank's existing commercial arm will cornerstone a small number of large-scale, private sector-managed funds of funds, which will in turn catalyse patient investments into high potential businesses.

• The government has committed to maintaining the bank's ECF programme with up to £1bn of commitments over the next 10 years through British Business Finance Limited, which is expected to support at least £1.5bn of new investment.

In addition to these measures around patient capital, support for the Enterprise Finance Guarantee (EFG) programme has been extended for a further four years and has been expanded to £500m per year, allowing the bank to guarantee up to £2bn of lending over that period.

The bank has also been asked to create and deliver a commercial angel investment programme to support business angels outside of London.

The bank will also carry out research in two areas of policy interest to the government, including exploring how intellectual property (IP) could be used as security to assist innovative firms with IP to raise finance, and how to overcome the specific barriers faced by female-led firms in accessing venture capital.

Keith Morgan, CEO of the British Business Bank, commented: “The additional finance announced today will allow the British Business Bank to support up to £13bn of long term patient capital, enabling more smaller businesses to scale up and fully realise their growth ambitions.

“The expansion of our flagship Enterprise Finance Guarantee (EFG) programme will also enable us to support up to £2bn of new lending over the next four years.

“By increasing our funding by two-thirds, this Budget presents an exciting opportunity for us to strengthen finance markets for ambitious, growing firms across the UK.”