Bank of England extends Funding for Lending Scheme

The Bank of England has announced plans to extend the Funding for Lending Scheme (FLS) for another year until 2015. This extension should build on the success of the FLS so far and it has three main objectives: to give banks and building societies confidence that Funding for Lending will be available on reasonable terms until January 2015; to increase the incentive for banks to lend to small and medium-sized enterprises; and to include lending involving certain non-bank providers of credit. Sir Mervyn King, Governor of the Bank of England, explained: "The FLS has contributed to a sharp fall in bank funding costs and an improvement in credit conditions since the middle of last year. The changes announced today build on that success by broadening the scope of the scheme and ensuring that it will continue to support the supply of credit, especially to small companies, into 2015.” April 26, 2013