FINANCE OPTIONS - Growth guarantee scheme
Growth Guarantee Scheme
✅ 70% government backed finance
✅ Get up to £2 million
✅ Launched 1 July 2024
✅ Available until March 2026
✅ 70% government backed finance
✅ Get up to £2 million
✅ Launched 1 July 2024
✅ Available until March 2026
The UK Government has announced a new scheme, The Growth Guarantee Scheme (GGS), which replaces the Recovery Loan Scheme (RLS) from 1st July 2024. It will be in place until March 2026 to help small businesses just like yours obtain finance to grow again and help with increased costs and rising inflation.
The Growth Guarantee Scheme extension means ongoing access to more businesses of between £1,000 and £2 million funding, through term loans, overdrafts, asset finance and invoice finance.
Following the end of the Recovery Loan Scheme on 30 June 2024, the Growth Guarantee Scheme came into plance on 1 July 2024 and will last until 31 March 2026.
The terms of the Growth Guarantee Scheme are similiar to the previous Recovery Loan Scheme. This means that to be eligible, your business will need to:
A straightforward cash injection you pay back over time. You might use a loan for R&D, moving to a new premises, or refinancing an existing loan.
Speed up your business cash flow by getting an advance on money owed to you in invoices, without waiting for debtors to pay you.
A loan designed for purchasing assets for your business. You might upgrade your equipment, tech, or invest in machinery
Lets you spend beyond your business account balance, maybe for a new project which requires marketing investment or a bargain stock purchase.
The Growth Guarantee Scheme is very similar to the previous Recovery Loan Scheme which ended in June 2024. As with the RLS, lenders are now likely to ask for a personal guarantee, regardless of the amount of funding applied for. This is where it differs from the original Coronavirus Business Interruption Loan Scheme (CBILS) and Bounceback Loan Scheme (BBLS). Although, your main home still cannot be taken as additional security by the lender.
The maximum amount of funding available through the Growth Guarantee Scheme hasn’t changed. Businesses will still be able to borrow up to £2 million, but this is inclusive of any other previous guarantee loans which are still outstanding (such as RLS, CBILS or CLBILS) and if they were taken out after 1st August 2022. Any guarantee scheme loans taken before 1st August 2022, will not count in this calculation.
Applications for the Growth Guarantee Scheme are open until March 2026.
To apply, simply sign up or login to your Capitalise for Business account. From here you can see how much you could be eligible to borrow and start your funding application.
Alongside dedicated support from a funding specialist, you will be able to apply up to 4 lenders in just one application.
The Growth Guarantee Scheme is backed by the UK Government. This means that the Government will guarantee 70% of the loan for the lender. This does not mean the borrowing business is not liable. In fact the borrower will always be responsible for repaying the loan in full. If for a legitimate reason the business cannot repay, the Government will repay the lender up to 70%.
Repayments for the Growth Guarantee Loan Scheme will start from month one of the loan. Your monthly repayments will be clearly laid out in the terms of the loan offer, if you receive one. Interest for GGS also starts from month one.
The decision to offer a facility is at the lender's discretion. Lenders will likely only choose to lend if there is a clear affordability shown to support the loan. If the business meets their normal lending criteria, they must offer the facility on their usual commercial lending terms, instead of using the GGS.
As far as we know, the Growth Guarantee scheme will have the same terms as the previous iterations of the Recovery Loan Scheme. The core difference between the two is that the Recovery Loan Scheme will only be available until 30 June 2024. After this date, the Growth Guarantee Scheme will be available.
Lenders are gradually being approved by The British Business Bank and you'll be able to apply to these for GGS funding directly from within the Capitalise platform.
Please be aware that some lenders may request additional information but this list is the minimum we need to be able to determine which lenders are most appropriate:
• Loan amount, purpose, and term
• A short paragraph on the business background
• Last 2 full sets of filed accounts
• Last 12 months bank statements (PDF format & no older than 7 days)
• Shareholder & directors details - name, DOB and home address
• Up to date management accounts
• Current debt position of existing loans, facilities etc
You could use a Growth Guarantee Scheme facility for the following business loan products:
With a GGS, term loans and asset finance facilities are available for up to six years. Business overdrafts and invoice finance are available on term lengths for up to three years.
Yes, a Growth Guarantee Scheme facility can sit alongside existing government-supported facilities without the need to refinance - if below the maximum facility limit or if taken out before 1 August 2022. Anything outstanding under RLS, CBILS or CLBILS taken after 1 August 2022 will count towards a business’ maximum amount.
Yes, subject to meeting the scheme eligibility requirements and provided they do not borrow more than what the business is entitled to.
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, Energy & Industrial Strategy. 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 https://www.british-business-bank.co.uk/recovery-loan-scheme for more information.
