The European Commission has approved a UK’s working capital guarantee scheme supporting banks which provide credit to businesses. Under the scheme, the UK Government will provide a guarantee of up to 50% of the value of capital loans to sound, credit-worthy companies with an annual turnover of up to £500 million. The aim of the scheme is that it will become self-funding. Banks will receive capital relief which in turn has to be used to fund loans to small and medium-sized enterprises. The scheme is limited to a two year period and has a budget of £10 billion.