Labour plans to set targets for funding female-led businesses through the state-owned British Business Bank and to launch a review of the financial exclusion of women, if it wins the next general election.

The initiatives, which will be announced by the shadow City minister Tulip Siddiq, form part of the party’s financial inclusion agenda, following a review by 10 City grandees earlier this year of Labour’s financial services strategy.

Siddiq will reveal plans for two new performance targets for the British Business Bank (BBB), the economic development bank best known for overseeing Covid funding schemes during the pandemic. That will include an “overall investment allocation target” towards businesses led by women, as well as those led by ethnic minority founders. The BBB will also be required to issue reports on the diversity of applicants it considered for funding.

The size of its funding targets have yet to be confirmed, but will be set in coordination with the BBB, Siddiq’s office said. However, a 2019 report by the BBB found that only 1% of venture capital investment in the UK went to companies founded by women.

The funding pledge will be made at an event celebrating women in the City at the Association of British Insurers (ABI) headquarters on Monday, in front of an audience including women from across the insurance industry.