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Throwing good money at bad ideas: Banks are being too generous in lending money to companies starting up, according to the Federation of Small Business. Reporting to a House of Commons select committee on trade and industry, the federation states that Government has encouraged the creation of `thousands of candy floss-type starter businesses’. The number of smaller companies has almost doubled, caused `in many instances by the negligent actions of the banks in lending money to some very dubious propositions’, says the federation. The Government should concentrate on supporting existing small businesses, recommends the federation.

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