Kingsway Asset Finance said the funding would allow it to bump up its leasing capacity by about £10m. The latest deal comes just over six months after it received £3m of funding from NatWest to assist with its growing client base.

Adrian Anthon, managing director of Kingsway in Wilmslow, said: "The North West is home to a thriving start up and small business community which we have been supporting for over ten years.

"The new British Business Bank Investments Limited facility will enable Kingsway to significantly increase our lending to small businesses both in the North West and further afield."

The funding is the latest in a series of commitments from British Business Bank Investments the leasing and asset finance market. In October, it provided a £40m boost to Staffordshire-based Shire Leasing, which was matched by private sector investment.

It comes after the bank's latest Small Business Finance Markets report revealed that 43 per cent of businesses seeking finance are looking to purchase fixed assets, an increase of 10 per cent since 2012.

Peter Wilson, chief executive of British Business Bank Investments, said: "Leasing and asset finance plays a crucial role in the diverse finance markets for UK smaller businesses. We believe we have already had a material impact on the block funding market, which is key for independent lease companies.

"We are continuing to support regional providers such as Kingsway, which are vital in ensuring we have finance markets which work better for UK smaller businesses.

"Our aim is to unlock more finance, offer more choice and ensure smaller businesses can make well-informed decisions about the right funding route for them."

British Business Bank Investments is also introducing a new Expansion Capital initiative to its investment programme, enabling investments either by way of long term equity or other form of risk capital to support the growth of companies active in SME lending markets.

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