The Australian Small Business and Family Enterprise Ombudsman Kate Carnell has welcomed new legislation introduced today by the federal government to establish the Australian Business Growth Fund.
"The Australian Business Growth Fund was a recommendation in our Affordable Capital for SME Growth report, which identified the need to address a critical funding gap for long-term capital to enable high growth potential SMEs to flourish," Ms Carnell says.
"This fund will benefit SMEs with annual turnovers of between $2 million and $100 million.
"Established businesses will be eligible for long-term equity capital investments between $5 million and $15 million.
"Importantly the fund will be managed by private sector expertise and will invest between 10% and 40% in the chosen businesses, allowing the business owner to maintain their controlling interest while giving them the funds they need to invest in growth.
"We welcome both the government investment in the fund, along with the major banks and financial institutions' contribution.
"The fund is currently valued at $540 million and we support the government's ongoing discussions with other potential investors, with the ambition to grow the fund to $1 billion as it matures.
"This initiative comes at a time when many respected economists, including those at the Council of Financial Regulators, are expressing concerns about the difficulties Australian SMEs face in accessing finance.
"The Australian Business Growth Fund will significantly encourage business growth and promote economic expansion."
