Small firms are to get access to 100% taxpayer-backed loans of up to £50,000 in the next week.

Amid fears that small businesses may fold before receiving government rescue funds, the chancellor yesterday announced the scheme offering firms loans up to £50,000. The scheme will be up and running next week and applicants will receive the money within days of applying.

The scheme requires filling in a two-page self-certification form online.

The loan terms mean that no capital or interest repayments will be due for one year. Instead, the government will pay the interest for the first 12 months.

Underwriting the loans removes the risk that banks will not get their money back, which the government hopes will speed up the application process.

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