The successor scheme to the Recovery Loan Scheme, the Growth Guarantee Scheme (GGS) launched in July 2024 and is designed to support access to finance for UK small businesses as they look to invest and grow.
The Growth Guarantee Scheme aims to improve the terms on offer to borrowers. If accredited lenders of the scheme can offer a commercial loan on better terms, they will do so.
Growth Guarantee Scheme-backed facilities are provided at the discretion of accredited lenders of the scheme, who are required to undertake their standard credit and fraud checks for all applicants.
Scheme details are below, but why not let Shadowfax Funding Solutions help you navigate through the myriad of restrictions and rules. Grow your business with us. Book a free consultation call with a friendly member of our team by clicking here. We’ll run through what you need and give you our expert advice. Then, if you want to proceed, we’ll find you the best offers from a number of lenders. Book your consultation today by clicking here.
Growth Guarantee Scheme features:
-Up to £2m business group:
The maximum amount of a facility provided under
the scheme is generally £2m per business group for
borrowers outside the scope of the Northern Ireland
Protocol, and up to £1m (or such other sum as notified
from time to time by us to the lender in accordance
with the relevant legal agreement(s)) per business group
for Northern Ireland Protocol borrowers. Minimum
facility sizes vary, starting at £1,000 for asset finance,
invoice finance and asset-based lending, and £25,001
for term loans and overdrafts.
– Wide 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 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 GGS accredited
lenders will vary and will depend on the specific lending
proposal. GGS accredited lenders pricing will take into
account the benefit of the Government guarantee.
-Personal Guarantees:
Personal guarantees can be taken at the GGS
accredited lenders 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 GGS accredited lenders:
Growth Guarantee Scheme-backed facilities are
provided at the discretion of the lender. GGS
accredited lenders are required to undertake our
standard credit and fraud checks for all applicants.
The assistance provided through the Growth Guarantee
Scheme, like many Government-backed business support
activities, is regarded as a subsidy and is deemed to
benefit the borrower. There is a limit to the amount of
subsidy that may be received by a borrower, and its wider
group, over any rolling three-year period. Any previous
subsidy may reduce the amount a business can borrow
More information on subsidies is available here.
Eligibility restrictions:
– Turnover limit:
The scheme is open to smaller businesses with a
turnover of up to £45m (on a group basis, where part of
a group).
-UK-based:
The borrower must be carrying out trading activity in
the UK and, for most businesses, generating more than
50% of its income from trading activity.
-Viability test:
GGS accredited lenders must consider that the
borrower has a viable business proposition.
-Business in difficulty:
The borrower must not be a business in difficulty,
including not being in relevant insolvency proceedings.
-Subsidy limits:
Borrowers will need to provide written confirmation
that receipt of the Growth Guarantee Scheme facility
will not mean that the business exceeds the maximum
amount of subsidy they are allowed to receive. All
borrowers in receipt of a subsidy from a publicly
funded programme should be provided with a written
statement, confirming the level and type of aid received.
Please note: the following are not eligible under
Growth Guarantee Scheme:
– Banks, Building Societies, Insurers and Reinsurers
(excluding Insurance Brokers)
-Public sector bodies
-State-funded primary and secondary schools.
Advisory information:
As your Broker we will need to provide certain documents on behalf
of our clients when we apply for a Growth Guarantee-
backed facility. These are likely to include:
-Management accounts
-Business plan
-Historic accounts
-Details of assets
-Details of previous subsidy awards.
Decision-making on whether a business is eligible for
the Growth Guarantee Scheme is fully delegated to
accredited lenders by the British Business Bank.
Legal notice:
The Growth Guarantee Scheme is managed by the British
Business Bank on behalf of, and with the financial backing
of, the Secretary of State for Business & Trade. British
Business Bank plc is a development bank wholly owned by
HM Government. It is not authorised or regulated by the
PRA or the FCA. Visit www.british-business-bank.co.uk/
finance-options/debt-finance/growth-guarantee-scheme
As mentioned above Shadowfax Funding Solutions can help you navigate through the myriad of restrictions and rules. Grow your business with us. Book a free consultation call with a friendly member of our team or call us on 0113 518 2253. We’ll run through what you need and give you our expert advice.