1. £1bn for small firms — but are microbusinesses being left out again?

The Government is promising an extra £1bn of lending for small and medium-sized businesses over the next five years, unveiled by the Small Business Minister as part of its Plan for Small Business. On the surface, that sounds like welcome news. Access to finance has long been a brake on growth, and most businesses will need to borrow at some point to invest, expand or simply manage cashflow. But the detail matters — and right now, one crucial group is conspicuously absent from the language: microbusinesses.

That omission matters because microbusinesses are not a niche. Firms with fewer than 10 employees account for around 95 per cent of all UK businesses, employ more than 9 million people and generate roughly a third of private-sector turnover. They are the start-up economy, the self-employed, the local employers and the businesses most likely to create jobs when conditions allow. Yet they are also the most likely to be turned away by high-street banks, to struggle with affordability tests, or to decide borrowing simply isn’t worth the risk.

The Government’s push is clearly about encouraging more borrowing to accelerate investment and drive growth. The Department for Business and Trade is looking to mainstream banks and community development finance institutions, working directly and through the British Business Bank, to increase lending volumes. In theory, that should widen access. In practice, micros often fall through the cracks — too small for standard bank products, too cautious to take on debt in an environment of high interest rates, rising costs and fragile demand.

Recent surveys show that while demand for finance exists, confidence does not. Many microbusiness owners say they would rather delay investment than borrow on uncertain terms, particularly when margins are already under pressure from wages, National Insurance, energy and business rates. Growth-ready businesses don’t just need loans; they need finance that is accessible, proportionate and designed around their realities.

If this £1bn is to make a genuine difference, microbusinesses must be explicitly included — not as an afterthought, but as a priority. That means products sized for smaller borrowing needs, realistic eligibility criteria, and active promotion through trusted local and sector-based channels.

Because if the aim is growth and job creation, that doesn’t start with large SMEs. It starts with the smallest businesses, quietly employing people and reinvesting whenever they dare. Ignore them, and the headline funding figures will look impressive — while the real engine of the economy continues to sputter.

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