Business Growth Fund is proposing a £15bn growth fund to help businesses struggling under the weight of coronavirus emergency loan debt.

Stephen Welton, chief executive of Business Growth Fund, is talking to investors, the Government and his banking shareholders about the new fund. BGF’s shareholders include Barclays, HSBC, Lloyds and RBS.

Welton told the Financial Times that the UK faces a more devastating economic crash than the Great Recession of 2008, warning of “a totally unsustainable debt mountain” following the Government’s emergency coronavirus lending schemes.

Like others, Welton believes that many businesses will be crushed by this debt mountain, forcing them into bankruptcy and making a lot of people redundant.

The BGF fund would specifically target viable businesses that have borrowed money from the Coronavirus Business Interruption Loan Scheme (CBILS) but cannot repay it, because of the complete absence of customers.

Like the Future Fund, any BGF investment would have to be matched by private investors, which could include pension funds. Welton said that he had been talking to a couple of institutions about them coming on board. It has long been an ambition of his to have pension funds diversify into supporting fast-growth British businesses.

The BGF is not alone in calling for some kind of vehicle to invest in Britain’s brightest and best.

Former Treasury minister and Goldman Sachs chief economist Jim O’Neill has called for pretty much then same thing, a £25bn Patient Capital Fund to help businesses get out from under the debt mountain.

And Lord Blackwell, chairman of Lloyds, has suggested the Government could convert bad coronavirus emergency loan debt into equity, giving it stakes in thousands of small businesses.

To date, BGF has invested more than £2bn in growth businesses, making it the most active investor in the UK as well as globally by number of transactions. Two thirds of businesses it has supported have tapped state-aid schemes to get through the pandemic. Well-known companies backed by the BGF include meal-box service Gousto, ceramics brand Emma Bridgewater and fitness chain Gymbox.