Scottish Investment Bank head Kerry Sharp welcomed the establishment of a new £40 million small and medium sized enterprises (SME) holding fund by the Scottish Government to allocate investment from the European Regional Development Fund (ERDF).
Sharp said Scottish Enterprise had been awarded £28 million of the new funding and this would help the Scottish Investment Bank — Scottish Enterprise’s investment arm — to deliver growth finance for ambitious Scottish companies.
Sharp said: “We welcome the Scottish Government’s announcement today regarding the £40 million of new ERDF funding to help Scottish businesses to grow and become more innovative.
“In the context of the current economic environment, ensuring effective access to growth finance for companies is more important than ever.
“While levels of investment into Scottish companies has grown significantly over the last few years, there remains considerable competition for growth finance and this new funding will be critical to continued success.
“I’m pleased to announce that Scottish Enterprise has been awarded £28 million of this new funding.
“This helps the Scottish Investment Bank, Scottish Enterprise’s investment arm, to deliver the innovative Scottish Co-Investment and Venture Funds which provide equity finance to fund the growth plans of ambitious Scottish companies.
“This activity has a catalytic and positive influence on increasing both the supply of scarce capital to innovative growth companies and to delivering sustainable economic benefits.
“These funds operate in partnership with the private sector and increase the number of active investors, the amount of capital being invested into early stage Scottish companies and help to raise the international profile of Scottish equity investment.
“We look forward to continuing to work with our partners to collectively deliver a broader range of finance to support the next generation of ambitious Scottish companies.”
The Scottish Government said its SME Holding Fund would give companies access to microcredit finance of up to £25,000, loans of up to £100,000 and equity investment of up to £2 million.
It said the Holding Fund’s £40 million would be matched by an additional £60 million from public and private sector delivery partners, alongside private sector funding of £150 million so that at least £250 million would be invested in 500 companies by December 2018, creating 2,000 jobs.
Cabinet Secretary for Economy, Jobs and Fair Work Keith Brown said: “The £40 million investment will benefit a broad range of businesses and is projected to create 2,000 jobs.
“It is yet another example of exactly why maintaining Scotland’s relationship with the EU is so important as set out in our document – Scotland’s Place in Europe – yesterday.
“It outlines our determination to keep Scotland’s place in the European Single Market, which delivers so many social, economic and cultural benefits for individuals, businesses and communities and is the best way of guaranteeing jobs, investment, services and projects across the country.”