The UK government has introduced the Growth Guarantee Scheme, which aims to support small businesses in accessing essential finance for growth. Launching on 1st July 2024, this scheme will continue the work of the Recovery Loan Scheme. It provides a 70% government-backed guarantee on loans, asset finance, and invoice finance up to £2 million in Great Britain and £1 million in Northern Ireland. Understanding the Growth Guarantee Scheme could be important for your business – here’s what you need to know about the scheme:
Key Features
- Eligibility: Businesses must be UK-based, trading for at least two years, with a turnover of less than £45 million. They must not be in insolvency proceedings and should generate over half of their turnover from trading activities.
- Loan Details: Available through accredited lenders, businesses can access loans and overdrafts from £25,001 to £2 million, and asset or invoice finance from £1,000 to £2 million in Great Britain (lower limits apply in Northern Ireland).
- Purpose: The scheme supports recruitment, technology upgrades, machinery investment, and sales/marketing activities.
- Terms: Loans and asset finance can extend up to six years, while overdrafts and invoice finance have terms up to three years.
Application Process
Businesses do not apply directly; the scheme is accessed through lenders who decide if a business’s loan application requires the guarantee to meet lending criteria. Working with brokers can also help in finding the best financing options and preparing a strong application.
Benefits
The Growth Guarantee Scheme aims to assist around 11,000 businesses. It provides crucial financial support to help them navigate economic challenges and drive growth.
By leveraging this scheme, small businesses can secure the necessary funds to invest in their future. This will ensure resilience and growth in a competitive market.
Understanding the Growth Guarantee Scheme can help open up opportunities for your business. Find out more about the Growth Guarantee Scheme and how Funding Pool can help, here.
