has said he plans to take a "tough line" with parts of the UK banking system. Mr Cable said he would press banks to ensure they were meeting lending targets, especially those to small and medium-sized businesses.
He said this was a key factor to help an early economic recovery.
Mr Cable had earlier faced questions from MPs seeking assurances about £730m worth of help for business which is now under review.
The review of the previous government's pledges is part of efforts to cut public spending this year.
"We inherited a very large number of projects which were agreed in a hurry in the run-up to the last general election," Mr Cable told MPs in his first business questions in the House of Commons.
'Stifle recovery'
In what was described as his first major speech as business secretary, Mr Cable pledged to "redouble our efforts to ensure that bank lending agreements from banks that have benefited from taxpayer subsidy are being honoured - especially for SMEs [small and medium-sized enterprises]".
He went on to say the banks were wrong to say there was no demand.
"If the bar is set too high, of course no one is willing to jump," said Mr Cable.
"The current risk aversion by banks in the SME sector will stifle recovery and, if it does, will actually rebound on the banks through bad debt."
