HM Treasury has announced that the drawdown window for the Funding for Lending Scheme (FLS) has been opened and will remain that way for the next 18 months.
Banks and building societies will be able to borrow in the FLS at cheaper rates - for periods of up to four years.
It is hoped that the FLS will deliver credit easing to the whole economy, giving financial providers strong incentives to lend to businesses up and down the country.
However, the scheme has been the subject of some criticism, with director of policy at the British Chambers of Commerce Adam Marshall telling the BBC Wake Up To Money podcast that it misses the point.
He explained that many firms have no access to facilities in the first place will not find their position is improved at all.
Chancellor of the exchequer George Osborne said: "The more generous FLS has officially opened for business and will in time effectively take over from the NLGS [National Loan Guarantee Scheme], delivering credit easing to the whole economy."