The seminar was attended by the President of the EIB, Philippe Maystadt, the Secretary of State for Business, Enterprise and Regulatory Reform, Peter Mandelson, and the Chancellor of the Exchequer, Alistair Darling, in addition to representatives from UK banks and businesses.

The FPB, which is preparing to meet with Lord Mandelson and representatives from the banks on the new small business lending forum, has posted its petition on the Downing Street website.

"This European Investment Bank funding, which is being earmarked specifically for businesses, follows the £37 billion in tax payers money that the Government has already ploughed into the banks," said the FPB's Director of Finance, Nick Palin. "There can be no excuse for the major lenders not to live up to their responsibilities to small businesses. We are backing the Government's repeated calls for access to finance to be restored to 2007 levels, and will continue to push for this to happen as quickly as possible."

He added: "Already, more calls are being received by our member helpline concerning issues such as increased overdraft rates and reduced credit lines. Through its new economic downturn panel, the FPB will continue to scrutinise the banks' relationships with their small business customers. Through the petition, we are urging the Government to do the same."

Around 100 FPB members have been invited on to the new panel. They will be contacted regularly by FPB staff and asked to give their experiences of the economic downturn, in particular their experiences with the banks.

One of the members invited to participate is FPB member Kevin Whiting, of Sherdon Estate Agents, near Basingstoke, Berkshire. Mr Whiting has banked with HSBC for 17 years, however his recent application to increase his small mortgage in order to develop the site – and bring in an additional £600 per month – was rejected.

"They said they had decided to withdraw from the property development sector due to the current market conditions. My argument is that, if this is true, it amounts to a moratorium across the board, and means that they're not considering individual cases.

"In addition to increasing the value of our property, the extra income stream that would be generated would really help us in this climate. It's preventing me from growing my business. My mobility is also restricted now – I've looked elsewhere, but the percentage rate above LIBOR is too high with other banks, by as much as 3.5% or 4%."

He added: "Small businesses like mine are being seriously hit by these economic conditions. Over the past eight weeks or so banking issues have compounded an already difficult situation. I suffered bad experiences during the previous recession and, unless the banks free up funding, it will ultimately be the employees of small firms who suffer.

"The Government is doing what it can. The problem is that the banks have the same attitude as 20 years ago – they hand out umbrellas when it's sunny, only to snatch them back again when it's raining."

Recently, the Government announced an emergency package in support of small firms, including setting a public sector payment target of 10 days, providing Business Link ‘health checks', improving the provision of training and enhancing the availability of financial information. The FPB welcomed the move, but warned that more support was required to help businesses survive the credit crunch.

The FPB's Chief Executive, Phil Orford wrote to the British Banking Association (BBA), to urge its members to restore lending to 2007 levels. He will meet with the BBA in November 2008 to pass on the concerns of FPB members.

The FPB, which represents 25,000 small businesses across the UK, has produced a guide to surviving the credit crunch. Small businesses can find information on alternative sources of funding, such as asset-based finance and invoice financing, as well as advice on credit management. It is available from the FPB by calling 0845 130 1722 or visiting www.fpb.org.