Article – What is the UK Government’s Growth Guarantee Scheme?

The Government Growth Guarantee Scheme – The Year of the SME

The Growth Guarantee Scheme (GGS) is run by the British Business Bank and is the updated replacement of the Recovery Loan Scheme (RLS). It is aimed at small businesses looking to invest in and further grow their company. As 99% of companies in the UK are SME’s, supporting 27 million jobs and contributing to £4.5tn to the UK economy, the government announced 2024 as ‘The Year of the SME’ and is striving to support in their development. As a result, this scheme was launched in July 2024 until March 2026, estimated to assist 11 000+ businesses.

Key Features

Products offered:

GGS offers a wide range of products including term loans, overdrafts, invoice finance, asset finance and asset-based lending, so it is suitable for a wide range of business needs.

Amount available:

Great Britain

–           Asset finance, invoice finance and asset-based lending from £1000 – £2m

–           Term loans and overdrafts from £25 001 – £1m

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Northern Ireland Protocol

–           Asset finance, invoice finance and asset-based lending from £1000 – £2m

–           Term loans and overdrafts from £25 001 – £1m

Length of terms:

The loans range from as little as 3 months to a maximum of 6 years depending on the product type:

Term loans and asset finance (3 months – 6 years)

Overdrafts, invoice finance and asset-based lending (3months – 3 years)

Guarantee to the Lender:

The government provides a guarantee of 70% to the lender against the outstanding balance of the facility. This results in lenders being more likely to approve loan applications as they can recover funds from the government, but the borrower is always 100% liable for the debt.

Multiple Scheme Allowances

If a firm has previously taken out loans such as the Coronavirus Business Interruption Loan Scheme (CBILS), Bounce Back Loan Scheme(BBLS) and the Recovery Loan Scheme (RLS) before the 30^{th of} June 2024, they are still eligible, however, the maximum loan able to be borrowed may be reduced.

 Criteria

This scheme is open to small businesses trading in the UK with a turnover up to £45m, where at least 50% of that turnover is generated from trading activity. In addition, the firm must have been trading in the UK for at least 2 years. This is to ensure that the scheme targets smaller firms who need the most support, as well as proving their track record.

Requirements also include that the business must have a viable business proposition, such as managing cash flow, expansion or investing in new material and not be in a position of difficulty or any insolvency proceedings.

Why use the Best Finance Group to apply for the GGS Scheme?

We are a dedicated team who always strive exceed expectations utilising our vast amount of experience in government funding schemes. Our experienced and dedicated will guide you through this process, ensuring the best chance of succesfiul funding. If you have any questions about the scheme, please get in touch today for an informal chat.

Conclusion

Are you are thinking about applying for the GGS? This scheme is a great way to give access to funding for small companies by as lenders are more likely to approve applications, due to the guarantee. It can also help you to secure lower interest rates and repayment terms, compared to typical, conventional business loans, resulting in lower overall borrowing costs. This scheme can be a massive help for small businesses looking to pursue expansion and growth for their business. These funds can then be used for a variety of business activities from purchasing equipment to managing operational expenses.

‍Contact us today to discuss the Growth Guarantee Scheme and any other form of business finance.