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Last Updated: Wednesday October 08 2008 14:20 GMT

UK banks given huge cash boost

A series of bank images

The government has announced plans to lend billions of pounds to banks to try to end the cash crisis.

For months something called the credit crunch has been making headlines, and it's got people all around the world worrying about their money.

Although it may seem like it's all to do with banks, the problems have made things more expensive to buy, and people have lost jobs as a result.

It's hoped the government money the banks are getting will improve things.

The banks are being lent 50bn, which will make it easier for them to lend money to people and businesses.

Financial experts are really pleased the government has handed over this money, and seem to think it's the right thing to do.

Because the government didn't plan on spending the money they will have to borrow it. If the cash crisis gets worse, it may have to get more taxes from people to pay for it.

You've noticed the cash crisis

Some people don't like that part of the plan and are unhappy that taxes could be used to sort out a problem that they think the banks have created for themselves.

And it seems like you lot have definitely noticed the difference in your homes too.

Toni, Dean, Charmaine
Toni, 12, said: "My Mum says I can't go out as much and spend too much money because we need gas, electricity and food in the cupboard."

Dean, 13, told us something similar: "I've noticed when my dad comes back from work he puts all his money aside for bills, and in the long term I'll be affected."

Charmaine, 12, said: "I've got a little brother and sister who my Mum's got to look after and we've lots of animals too. It seems like the money's just wasting away."