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A billion-pound state guarantee for supply-chain insurance is set to be included in the Budget, according to reports.
The Financial Times has suggested that the scheme could be at the forefront of Budget initiatives aimed at helping small and medium-sized businesses through the recession.
According to the FT, the initiative will respond to concerns that thousands of businesses have been threatened by a reduction in credit insurance, which guards companies supplying products on credit against the risk of not being paid.
Lord Mandelson, the business secretary, had previously expressed his concern at the "immense financial distress" suffered by companies affected by the loss of cover.
It was reported, however, that there has been a delay in agreeing terms between government and insurers about the cost of state guarantees.
The French government also struggled to agree a deal before implementing a state guarantee scheme last year.
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