Pierre Williams from the Federation of Small Businesses told ITV News that if the Funding for Lending Scheme fails, the Government will have to "look carefully" at whether high street banks are the 'right conduit'.
The £80 billion scheme will give money to banks on the basis that they provide cheaper loans to kick-start lending.
More top news
An 11-year-old boy shot dead his eight-year-old neighbour in a row over a puppy, it is alleged.
Boris Johnson is expected to attack George Osborne's plan to cut tax credits when he addresses the Conservative Party conference on Tuesday.
Incursions by Russian jets into Turkish airspace have prompted a stern response from Nato's most powerful ally.