The government has unveiled a £20 billion loan guarantee scheme which is intended to increase funding to business insurance customers.
Lord Peter Mandelson, business secretary, says the money will only go to "genuine business needs".
Under the new plans the government will charge a fee to effectively insure the bank against loan, in case the borrowing company goes bust or cannot pay.
Gordon Brown says the plans will offer "real help now to deal with specific problems".
The Federation of Small Businesses (FSB) has welcomed the proposal, saying the responsibility is now with the banks.
John Wright, national chairman of the FSB, says: "The onus is now on bank branch managers to actively promote this money to its small business customers to ensure their survival and the revival of the economy."
He adds that the financial organisations have run out of excuses and the FSB will be keep an eye on lending levels, in addition to encouraging business insurance customers to apply for the loans.
