Small Firms Loan Guarantee Scheme

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This is a Government backed loan scheme to assist new business start ups and SME’s who have tried but failed to secure conventional loans due to lack of security. Loans are provided through our syndicate of banking and other finance partners and are underwritten by the Department of Trade and Industry to either 70% or 85% of the entire loan subject to whether the business has been trading for less than or more than 2 years respectively.

Loans are available for between 2 and 10 years for sums of between £5,000 and £100,000 (£250,000 if the business has been trading for in excess of 2 years). In return for the guarantee the borrower pays a premium of 1.5% per annum (0.5% per annum if loan subject to fixed rate of interest) on the amount outstanding on the loan.

Although the scheme is available to all UK companies with an annual turnover of no more than £1.5 million (£5 million if a manufacturer) there are certain exclusions to eligibility. In particular if you have already benefitted from a small firms loan, but failed to meet its obligations, it is highly unlikely that you will obtain approval for a new venture.

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