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Growth Guarantee Scheme, successor to Recovery Loan Scheme, launches to help small businesses access finance

Growth Guarantee Scheme, successor to Recovery Loan Scheme, launches to help small businesses access finance
Dan Martin
Dan MartinDan Martin Content & Events

Posted: Thu 11th Jul 2024

The Growth Guarantee Scheme, which aims to help around 11,000 smaller businesses invest and grow, has launched.

The initiative is the successor to the Recovery Loan Scheme, which was originally set up in 2021 to assist businesses to access finance and recover from the coronavirus pandemic.

The Growth Guarantee Scheme was announced in this year's Spring Budget by former chancellor Jeremy Hunt.

It runs until 31 March 2026 and provides a 70% government-backed guarantee. The borrower always remains 100% liable for the debt.

More than 40 lenders have been accredited for the scheme. As of 8 July, 20 lenders are open for applications.

Growth Guarantee Scheme terms

  • Up to £2m per business group: The minimum and maximum amount of the facility varies according to the business's circumstances and the type of facility. Maximum facility sizes are up to £2m per business. Minimum facility sizes start at £1,000 for asset finance, invoice finance and asset-based lending, and £25,001 for term loans and overdrafts.

  • Range of products:  The Growth Guarantee Scheme supports term loans, overdrafts, asset finance, invoice finance and asset-based lending facilities. Not all lenders will be able to offer all products.

  • Term length:  Term loans and asset finance facilities are available from three months up to six years, with overdrafts, invoice finance and asset-based lending available from three months up to three years.

  • Access to multiple schemes:  Businesses that took out a Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS), Bounce Back Loan Scheme (BBLS) or a Recovery Loan Scheme (RLS) facility before 30 June 2024 are not prevented from accessing the Growth Guarantee Scheme, but borrowing under these schemes may reduce the maximum amount the borrower is eligible for.

  • Pricing:  Interest rates and fees charged by lenders will vary and will depend on the specific lending proposal. The lender's pricing will take into account the benefit of the government guarantee.

  • Personal guarantees:  Personal guarantees can be taken at the lender's discretion, in line with their normal commercial lending practices. Principal Private Residences cannot be taken as security within the scheme.

  • Guarantee is to the lender:  The scheme provides the lender with a 70% government-backed guarantee against the outstanding balance of the facility after it has completed its normal recovery process. The borrower always remains 100% liable for the debt.

  • Decision-making delegated to the lender:  Growth Guarantee Scheme-backed facilities are provided at the discretion of the lender. Lenders are required to undertake their standard credit and fraud checks for all applicants.

How to access the Growth Guarantee Scheme

Further information on the Growth Guarantee Scheme, including the current list of accredited lenders, is on the British Business Bank website.

Related funding resources

How to raise money for your start-up

Enterprise Nation's Funding Hub

How to choose the right type of funding for you

Dan Martin
Dan MartinDan Martin Content & Events
I'm a freelance content creator and event host who helps small businesses and the organisations that support them. I'm also Enterprise Nation's Local Leader for Bristol. I have 20 years of experience as a small business journalist having interviewed hundreds of entrepreneurs from famous names like Sir Richard Branson and Deborah Meaden to the founders behind brand new start-ups. I've worked for a range of leading small business publications and support groups, most recently as head of content at Enterprise Nation where I was responsible for the prolific output of content on the company's blog and social media. I now freelance for Enterprise Nation as the website's news reporter and as the host of the Small Business sessions podcast. I'm based in Bristol where I run and host regular events with the local small business community in my role as Enterprise Nation's Local Leader for Bristol. I also have strong connections with other major business organisations in the south west region. In total, I've hosted over 100 events including conferences with an audience of hundreds for international brands like Xero and Facebook and live web chats from inside 10 Downing Street. With my partner, I co-run Lifestyle District, a lifestyle blog focused on culture, art, theatre and photography.

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