UK banks will lend £190 billion to businesses while cutting their own bonuses, the government has announced.
The good news comes as many firms have struggled to raise funds and survive the financial crisis.
£76 billion of lending is to be allocated to the Business Growth Fund, which will be set aside for small or medium-sized UK businesses.
The scheme - known as Project Merlin - involves the Royal Bank of Scotland, Barclays, HSBC and Lloyds.
Bank bosses held a conference call and agreed on the deal yesterday (February 9).
Project Merlin will also include a range of tighter controls on bankers' bonuses and increased transparency as to how much they earn.
Chancellor George Osborne said on the Yahoo! website: "The anger at the terrible mistakes of the banking industry and the failure of those who regulated it will long remain, and rightly so.
"Anger and retribution will not bring one percentage point of growth or create one job ... but Britain must move from retribution to recovery."
The government's announcement received a mixed response by many UK business leaders.
But how does the raise in bank lending affect you?
Will your business benefit by more business lending?
Is this the boost the UK economy needs?
Have your say in the Findlaw Community, where you'll find answers to most major topics within UK law.
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