With the news that ‘Big Society’ is word of the year for Oxford dictionaries, many people gave a cynical yawn, as well as pointing out that it is in fact two words. Haven't we been here before, with Tony Blair's ‘Third Way’?

There may be anger about the fat cats of the City, but it's worth celebrating when business people and entrepreneurs give a helping hand to those less fortunate.

IT millionaire Paul Barry-Walsh, founder of SafetyNet, now Guardian IT, set up the Fredericks Foundation, the UK's largest micro-finance organisation, in 2001 as a social enterprise aimed at helping young people who had made bad decisions to get back on track.

Because of the credit crunch, with banks unwilling to lend to small businesses, Fredericks has now branched out to help existing companies rejected by their banks, as well as lending to the long-term unemployed.

It has given more than 700 loans worth £3m in ten years. Conservatively, the Fredericks Foundation estimates it has saved the UK Government £15m by taking people off Jobseeker’s allowance and enabling them to run their own businesses.

One of its first clients in Oxfordshire was Dominic Greenough, a Harwell window cleaner, who borrowed money from his brother-in-law to buy a van and equipment after being made redundant by his employer.

The banks did not consider him credit-worthy, but his business is now flourishing and he hopes to pay off his Fredericks loan next year.

He explained: “My brother-in-law wanted the money back to pay his tax bill, and the Jobcentre put me on to Fredericks. They gave me an interview and I explained our situation. They were only interested in the business we have got and the drive behind it. They would have lent us more money if we wanted. It was ideal.”

His company, D G Professional Cleaning Services, uses a water-fed pole to clean windows, as well as offering pressure washing and carpet cleaning, all using eco products, and he says business has grown by word-of-mouth, despite the recession.

As well as Mr Barry-Walsh's money, the foundation is also funded by the European Social Fund and the Phoenix Fund. Affiliated businesses give one per cent of their profits each year, as well as giving up some of their time to support the work.

One of its supporters is Mike Jennings, of Monument Business Park, Chalgrove, who has offered office space to the charity's new Oxfordshire representative, former bank manager Tim King.

Mr King said Oxfordshire County Council had given £60,000 to support the initiative.

“The foundation was set up because Paul Barry-Walsh wanted to give something back, helping disadvantaged people to start up in business. Over the years that has widened from the unemployed and ex-offenders to helping single operators — people who would not be able to save up the money needed. We would help anyone who cannot get traditional bank finance.”

He says the process is informal, unlike the meetings he held in his former career with Barclays and Clydesdale.

Clients are referred by advice services such as Business Link as well as Jobcentres.

“We are the lenders of last resort. If I think the business plan has legs, I visit the applicant and we sit down for a cup of coffee. Once they have done all the investigations they need to, they meet the panel of experts.”

The panel interview is more like Dragon's Den than The Apprentice, he said.

“It's a friendly interview. They are not trying to score points. It's just people talking to them, and the decision is made at the end of that meeting — are we going to support or not?”

Local experts involved include Gavin Little, of Oxford accountants Critchleys, who said he was looking forward to supporting people who were keen to succeed, and Steve Clark, of James Cowper.

Mr King said: “To have local people making local decisions is important to us. I'm from the south of Oxfordshire, for instance, so I don't know what happens in Banbury. You need local knowledge about how many hairdressers there are, for instance.”

Oxfordshire is an unusual area for the Fredericks Foundation because usually it has to provide mentors to guide the fledgling business people to success.

But when Mr King took over the post last year, he discovered the county already had an effective network of voluntary advisors, which he has plugged into gratefully.

“Oxfordshire Business Enterprise helps people at the beginning to write their business plans. Once we have lent them the money, the Thames Business Advice Centre will mentor them so that there is always someone to help them. Oxfordshire is really lucky. It's a fantastic story — the county is very dynamic,” he said.

n Mr King is keen to meet potential business sponsors to explain the tax benefits of supporting the foundation.

o Contact: tim@fredericksfoundation.net Web: www.fredericksoxfordshire.org