Government Loan Schemes

Government-backed support schemes were designed to help SMEs continue to trade, recover and grow during the coronavirus pandemic.

Whether you're starting a new enterprise or looking to grow, purchase necessary equipment or finance working capital needs, Funding Options can connect you to more than 120+ lenders, offering dozens of products that could enable you to secure the finance you need.

The Growth Guarantee Scheme

The government backed Growth Guarantee Scheme replaced the Recovery Loan Scheme (which in turn replaced the Bounce Back Loan Scheme) with the same loan terms as the Recovery Loan Scheme. The Growth Guarantee Scheme will run from its 1 July 2024 launch until 31 March 2026 and is estimated to help 11,000 businesses borrow up to £2M.

This rebrand from the Recovery Loan Scheme to the Growth Guarantee Scheme demonstrates a commitment from the government to support the growth of British SMEs, given in the first instance the focus was on recovery and here the branding is centred around growth.

The government guarantee covers 70% of the loan amount, providing more security for lenders and a stronger incentive to extend credit to eligible businesses. The original iteration of this scheme started as a response to the difficulties many businesses faced as a result of Covid 19.

This scheme can be used to support pivotal business expenses, including equipment purchases, marketing campaign funding, and payroll. The scheme is launched in the hopes that businesses will have easier access to essential funding and vital support to facilitate growth thereby boosting the economy. There is also the hope that this scheme will enable reduced interest rates given the guarantee helps limit some of the exposure for lenders.

Finding an alternative business loan

If you're thinking about applying for the Growth Guarantee Scheme, carefully consider your different options. There are many alternative finance products available now that might be better for your business. We work with 120+ lenders offering the widest selection of alternative finance products available, including: 

• Unsecured Business Loans - finance of up to £750,000, no security. For businesses that don’t own many assets, don’t want to offer security or need finance quickly.

• Revolving Credit Facilities - pre-approved funds with a rolling agreement. A good alternative to business overdrafts and often more accessible.

• Asset Finance - finance for business assets, e.g. equipment and vehicles. Also enables you to release cash from the value in assets you already own.

• Secured Business Loans - loans based on the assets owned by your business. These loans are suitable for businesses that own assets like commercial property, vehicles and machinery, or company directors that don’t want to offer a personal guarantee.

• Property Finance - designed for property investors and businesses that need to ‘bridge a gap’ in finance. Bridging finance allows landlords and property developers to purchase a property before selling their existing asset.

• Invoice Finance - if you regularly invoice as part of your businesses, you could be eligible for invoice finance — one of the best ways to ease cash flow problems and get paid faster for completed work.

• eCommerce Finance - if you do business online, and are looking to grow your inventory or invest in your online presence, this could be the right finance to fuel the growth of your online business venture.

• Structured Finance - use this finance to facilitate the sale and purchase of a company you are acquiring. There are a few types of Structured Finance options which include Management Buyout (MBO), Management Buyin (MBI), Leveraged Buyout/Buyin and Acquisition Finance.