Chancellor Rishi Sunak is reportedly considering offering a 100% guarantee on loans to small businesses of up to £25,000.
According to the Financial Times, Sunak is set to up the guarantee, which currently sits at 80%, in a bid to make it easier for banks to supply the loans and comes after the Bank of England governor Andrew Bailey said the current system was “too complicated”.
The news comes despite Sunak previously saying earlier this week that he was still “not persuaded” by the calls for the government to offer a 100% guarantee to banks.
If Sunak is to make a u-turn it is expected that an additional 1 million businesses could benefit from the loan.
However, according to the BBC the eligibility criteria for the fully guaranteed loans has not yet been decided in terms of how small a business will have to be to qualify.
Reports also suggest that the changes to the loan could be announced as early as next week.