Business secretary Vince Cable would "love to liberalise credit unions" as a means to filling some of the finance gap faced by growing businesses.
Speaking to the Huffington Post UK after his speech at the Imperial College of London - where he laid out the government's investment strategy for UK business - he said: "I'd love to liberalise the credit unions, although there is obviously the problem around the concept of their common bonds - but there is definitely a wider role for them and building societies."
Cable added there were existing models from which the UK could learn, such as the Irish and American credit union structures, but admitted there was more than a decade's worth of politicians who had so far failed to change the regulations surrounding them.
In January, a rule change, enabled credit unions in the UK to operate more like their counterparts in countries like the US, but progression has stalled because the Financial Services Authority, which regulates financial institutions, still has to sign off on a set for lending rules and each credit union will have to ballot its members to get approval for an extension to its lending criteria.
The business secretary's beliefs echo those of his minister Michael Fallon, who told the Huffington Post UK on Monday the government's Business Bank would assist all alternative funding mechanisms, including helping credit unions.
The joined up thinking of the two men went some way to show they are not at odds with every decision, following days of press coverage highlighting their differences over employment laws.
Vince Cable also confirmed that the Business Bank idea, while still in its "gestation period" would be more substantial than a simple website or portal and would also not be a case of simply re-hashing existing government initiatives to encourage lending in the private sector.
Calling for an end to "laissez-faire government" where ministers remain hands off, he pledged to set up long-term strategies - to last longer than a parliament "or until the next spending review" for certain industry sectors.
These sectors include advanced manufacturing, knowledge-intensive traded industries, and the industries which assist them.
This will include building strategic partnerships with industries and targeting support for them to help realise their substantial growth prospects.
Cable also acknowledge the role the government can play as a customer to British businesses, and talked about developing a more intelligent partnership with its own supply chain by reforming procurement to make sure that businesses have the confidence to take long-term investment decisions.
Responses to Cable's speech have been largely positive, though most retain some scepticism until the policies are put into action.
One audience member at the event questioned whether the Treasury would be supportive of long term goals, given the need for short-term economic 'wins' - Cable responded by saying George Osborne was supportive of his thinking adding "there's no conflict between the chancellor and I".
John Walker, the national chairman for the Federation of Small Businesses, particularly welcomed the Business Bank plan, saying housing all the government’s schemes under one umbrella organisation would help small firms know where to go for help.
"Utilising a similar approach to the US's Small Business Administration would help deliver the industrial strategy, and the small business bank could be the first step. The SBA in the US has been running for 60 years and has helped to create jobs and spawned successes such as Apple, Ben & Jerry’s and Nike,” he added.
Next Generation Finance Consortium's head of policy Anil Stocker said the Business Bank should act as an educator for businesses.
He said: "A number of innovative new alternative finance institutions have sprung up in the wake of the banking collapse, helping UK businesses to find funding while the banks struggle with their balance-sheets. New solutions now exist for every stage of the life-cycle of a business, from equity finance through to long-term loans, credit unions, and working capital finance.
"A truly diverse lending landscape is within sight, and public sector initiatives must ensure that they embrace it as a goal.”
And John Cridland, the Confederation for British Industries director-general, said: “The government has introduced a number of funding schemes to assist smaller businesses, so to help them make best use of these, a business bank that acts as a ‘one-stop shop’ for these initiatives is a priority.
“While we don’t believe a state bank lending directly is necessary, there is a critical need for an aggregation platform which bundles loans to kick-start a bond market for medium-sized businesses and provide new alternatives to traditional bank financing.”