The British Business Bank’s ENABLE Build Programme — set up by the government — will ensure enough credit is available to allow smaller housebuilders to enter the market.

Local builders will be able to secure loans from participating banks for new housing developments throughout England.

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Jenrick said: “Small housebuilders are vital to building the homes this country needs, but too often struggle to access affordable finance.”

Housing minister Esther McVey MP added: “When it comes to building houses, we mean business — this fund will give everyday lenders the confidence needed to do deals with smaller builders which get shovels in the ground.”

Reinald de Monchy, managing director of guarantee and wholesale at British Business Bank, commented: “…The ENABLE Build Programme will allow us to build on our ENABLE Guarantee’s success in supporting smaller housebuilders that have traditionally struggled to access the funding they need.”