The anticipated tightening in the already restricted lending market is the result of a move by the Treasury to reduce its exposure to the Enterprise Finance Guarantee (EFG) scheme.

From March 2011, the state liability to any EFG lender will be cut from 9.75% to 9.225% once the lender’s exposure passes a £1m threshold.

Jamie Nelson, of Compass Business Finance, said: "The Small Firms Loan Guarantee, which preceded the EFG, didn’t have a cap like this and the fact the government is looking to reduce its liability does have the potential to reduce the facility available.

"It’s coming at a strange time, when we’re coming out of a very tough period and those companies that have survived are looking to invest and suddenly these cap figures are moving in the wrong direction."

Nelson added that lending remained tight and was at odds with rising demand from the print sector.

"We’ve been through a prolonged tough economic environment and people are definitely starting to look now at where they want to invest," he said.

"But its still a nervous credit environment and finance is no more available now than at any time in the last six months – we’re still fighting the same battles to get credit approved.

"We don’t know if it will ever get back to where it was, but even to get back to a level that’s reasonable, it’s going to take a long period.

"That said, if you’re a stronger business and can get that credit then now is definitely a good time to invest with rates where they are and only likely to go up once we get into next year."

Gerry Hoare of advisory boutique Deal Bureau added that even without the new cap it was already very difficult for printers to access finance under the EFG scheme.

"Sadly for the SME sector, it is still very difficult for businesses to raise finance," he said. "Banks are lending to the bigger companies where they understand the risk and believe that the risk is lower. This is very much like the last recession in
the 1990s."

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EFG CAP
• State guarantee on the first £1m lending under the scheme to increase from 9.75% to 15%
• State guarantee above that to be cut from 9.75% to 9.225%
• The cap change will apply to lenders of all sizes