SMALLER North East companies are just weeks away from being able to access funds from a new £5m pot which has been created to lend growing businesses sums as little as £1,000.

At a time when bank funding is still not an option for many the new Finance for Business North East Micro Loan Fund (MLF) is being viewed as a lifeline for over 700 regional businesses.

It will be launched next month by Newcastle-based North East Finance and will provide loans of between £1,000 and £25,000 to both start-ups and established SMEs.

Andrew Mitchell, chief executive of North East Finance said: “Many SMEs are still finding it difficult to attract finance and the Micro Loan Fund enables us to help out where there is a clear need.”

James Ramsbotham, chief executive of the North East Chamber of Commerce, said: “We are very much aware that small businesses are struggling get enough finance, so anything that provides financial support is welcome.

“This lack of money is stopping businesses from growing and is stopping some businesses from starting in the first place

“With the jobs cuts in the public sector starting to impact on the region this could be a vital lifeline for people being made redundant from the public sector to start new businesses.”