Growth Guarantee Scheme 2026: the £6.5bn lending many small businesses don’t know about

The Growth Guarantee Scheme received a £6.5bn uplift earlier this year, and it's expected to unlock a further £6.5bn of government backed lending for UK small businesses over four years. With higher wage bills and slower growth confirmed in the Autumn Budget 2026.

In this article, we cover what changed when the scheme was expanded, why it matters following the Budget, which businesses it can help and how the government guarantee works for borrowers.

What changed in the Growth Guarantee Scheme expansion?

The Growth Guarantee Scheme is run by the British Business Bank. Its £6.5bn uplift is expected to support an estimated 33,000 businesses across the UK. The expansion also widened who can use the scheme and how long some facilities can run for.

The scheme's 70% government backed guarantee to lenders stays in place.

Why does the Growth Guarantee Scheme matter after the Autumn Budget 2026?

The Budget offered small businesses some support, but it also confirmed higher costs and a slower economy in 2027. The National Living Wage will rise by 3.9% to £13.21 an hour from April 2027, higher inflation is forecast and the Office for Budget Responsibility (OBR) expects growth to slow to 1% next year. The Budget also raised the bank surcharge from January 2027, which could affect the cost and availability of bank lending. For many owners, finding affordable finance in the first half of 2027 will be essential.

Which businesses can use the Growth Guarantee Scheme?

The Growth Guarantee Scheme is not only for startups or businesses in difficulty. Following the expansion, businesses with a turnover of up to £54m can be eligible, which means many more established firms now qualify.

Nick Richardson, Head of Funding at Capitalise, said:

"The Growth Guarantee Scheme is one of the most useful tools available, yet it rarely makes headlines. A lot of business owners assume government backed lending is only for startups or for businesses in trouble."

The scheme also covers a wider range of finance than many owners expect, including term loans, overdrafts, asset finance, invoice finance and asset based lending. You can see the full eligibility criteria on our Growth Guarantee Scheme page.

How does the government guarantee help businesses get finance?

Under the Growth Guarantee Scheme, the government gives lenders a 70% guarantee on each facility. Because part of the risk is covered, lenders may be able to approve businesses they would otherwise turn down, helping more firms access finance they might struggle to secure. The guarantee is for the lender, not the borrower. Your business remains 100% liable for repaying the debt, so it's important to borrow for a clear purpose. Businesses apply through one of around 70 accredited lenders.

What else did the Autumn Budget 2026 announce for businesses?

The Growth Guarantee Scheme sits alongside several Budget measures aimed at helping businesses start, grow and access funding:

• The British Business Bank is doubling its commitment to women led businesses to £200m.

• A new young entrepreneurs allowance will be piloted in England, providing support with living costs during a business's first year.

• Mayors will receive £165m in 2027 to 2028 to set up Good Growth Funds, alongside £120m of incubator capital.

• From April 2027, 10,000 energy intensive manufacturers will get a 20% to 25% discount on electricity through the British Industrial Competitiveness Scheme.

• The main rate first year allowance rises from 40% to 50% for qualifying spending from 1 January 2027, supporting businesses that invest in equipment.

Our Autumn Budget 2026 overview covers the full set of announcements. For comparison with previous years, you can also read our coverage of the Autumn Budget 2025 and the Autumn Budget 2024, which looked at that year's government funding schemes.

Find out if your business qualifies for the Growth Guarantee Scheme

If your business needs to invest, hire or get through a quiet January, you can check whether you qualify for the expanded Growth Guarantee Scheme. Capitalise gives you access to a panel of 130+ lenders and can help you find out whether a scheme backed facility is an option for your business.