"Business Growth Funds have more modest return expectations and no hard exit deadlines, allowing business owners to set their own growth targets, and identify the most appropriate time and path to exit," Nash said.
"Banks that own the fund could refer SMEs to it where equity finance would be more appropriate than debt finance.
"The fund would be an active investor focused on providing growth capital, and wrap-around capability support," Nash said.
"The fund would always be a minority investor with a seat on the board, offering guidance and expertise, but always leaving owners in control."
Jo Tozer, spokeswoman for MYOB New Zealand, said accessing capital was a key challenge for many small firms, so today's announcement of the new fund would be welcomed by many.
Approximately 48 per cent of SMEs in MYOB's 2022 Business Monitor stated that access to finance will be a pressure point on their business this year.
Tozer said the Business Growth Fund would provide good long-term help - but did little to help businesses in the short term that were struggling with issues brought about by the Covid-19 pandemic.
"Immediate-term issues for SMEs are really trading out of the peaks of the pandemic, and they are still really struggling.
"Although this funding will provide long-term relief, what has been really key in businesses minds is short-term relief from pain they have been feeling trading through the pandemic. While this is a long-term option for growing their businesses they are still trying to recover from what has been challenging trading over the last two years," said.
SMEs would have liked to have seen some short-term relief announced in the Budget, she said.
"For SMEs, that has been the ask, and while there are some great initiatives around their long-term future many will be disappointed that there wasn't that short-term relief they were looking for."
Business lobby group BusinessNZ and campaign Buy NZ Made welcomed the money.
Buy NZ Made executive director Dane Ambler said many small businesses were "teetering on the edge" and were in desperate need of more financial support.
"Small businesses have shown resilience to get through the past 12 months, despite a perfect storm of Covid in the community, staff shortages, a closed border and shipping costs and delays.
"With the threat of a looming recession, inflation and ongoing shipping issues, we need to continue to help local businesses get back on their feet and thrive," Ambler said.
"The flow-through of Covid is only just reaching some businesses. We needed decent support for Kiwi companies from today's Budget, and we look forward to seeing how businesses can benefit from the fund in the next 12 months."
BusinessNZ chief executive Kirk Hope said business was looking for ways to shore up skill shortages, reduce business tax and costs, and more scrutiny of employment changes.
He said the group would have liked to have seen more investment in infrastructure, lower corporate taxes and a path for getting inflation under control.
"$60 million to boost broadband will benefit remote business. And it's good to see Government thinking about helping industry transform for the future.
"But, as always, the quality of these initiatives will be crucial.
"Likewise, $100 million for small business is excellent, but it all depends on the how."
Zac de Silva, chief executive of business consultancy group Business Changing, said any initiatives to help SMEs access to funding was positive, especially now with house equity dropping in value; which traditionally was a major source of finance.
"The decisions around who to invest in will need serious scrutiny and systems as sometimes government funding for businesses can be like a lolly scramble.
"The banks who it sounds like will administer should take some external advice from SME experts to make sure the framework is set up for success. There will need to be very good accountability and transparency around any government investment to ensure SMEs use the money as best as possible.
"Personally I'd be concerned that there will be wrong companies chosen to invest in and this will mean a lower ROI from this fund. It is exciting as a concept but needs some great thought from a wide variety of people."
De Silva said $100m investment was good for starters but business would want to know what the longer-term commitment was.
More transparency from the Budget, and, given the concern about the prospect of a recession, many would have liked to have found out about what changes the Government might have to make if New Zealand moved closer to a recession, would have been welcomed too, he said
"Many businesses are worried about the threat of a recession. Many, given the golden run most have had for a decade or so, have forgotten what it takes to proactively get through a recession. Government could be more up front about what changes they might make that they can control if we do move closer to a recession. What can the Government do to help reduce the mental angst that many business owners will have if business does shrink."
The Employers and Manufacturing Association said the Business Growth Fund was "one piece of good news" announced in today's Budget.
"The Government's fourth wellbeing Budget fittingly delivered a raft of initiatives to support people, communities and the environment, but when it came to business support it was much as expected," chief executive Brett O'Riley, said.
"The good news is $100m has been allocated for a Business Growth Fund to give SMEs better access to finance. It is modelled on successful systems overseas and will be very welcome. The $60 million to boost broadband will also benefit remote businesses."
