Businesses with a turnover of less than £10m could still receive cash from the Business Growth Fund (BGF), according to its chief executive Stephen Welton. He told Insider turnover "doesn't mean everything" when it comes to funding decisions.
The £2.5bn fund has been set up with the remit to lend to companies with turnovers ranging from £10m to £100m.
But Welton said: "We will look at businesses in terms of their potential and the turnover is a very simple way for us to establish whether or not it's a company that has a certain critical mass but it's by no means everything.
"So we're not going to be completely tied by a figure, we're going to look at the business, the sector, the growth opportunity as well as the turnover."
BGF has received criticism from business leaders because it is not open to businesses with a modest turnover.
Brendan Flattery, Sage UK's chief executive officer, said: "Whilst initiatives like the BGF are at least a step in the right direction, the criteria set for application to the fund means that relatively few businesses can actually benefit.
"Opening up funds to established businesses with a turnover of £10m or more is hardly a step-change to the status quo, where banks remain highly conservative, and risk averse in their lending."
But Welton said the £10m benchmark has been set to reflect that the fund is targeted at established businesses.
"The threshold indicates that we are targeting established businesses, there is no magic to £10m as such, but what we are not well placed to do is to provide capital to start-ups, sole traders or an inventor – that end of the market is well served by business angels and venture capital trusts."
"We'll use common sense when it comes to funding decisions," he added.