The British Business Bank’s Growth Guarantee Scheme is set to provide an additional £500 million in lending capacity to support smaller UK businesses facing cashflow pressures due to changes in global tariff rates.

Announced by the Chancellor, the funding aims to strengthen access to finance for firms impacted by shifting trade conditions. Delivered through a network of around 50 accredited lenders, the scheme enables lending of up to £2 million per business, backed by a 70% government guarantee.

Since its launch, the Growth Guarantee Scheme has facilitated £2.1 billion of finance across more than 13,000 loans. The newly allocated capacity is intended to support a wider range of businesses, particularly those navigating the effects of international trade disruptions.

Businesses can use the finance for a range of legitimate purposes, including managing working capital and operational cashflow. While the scheme improves borrowing conditions, applicants must demonstrate an ability to service new debt and meet lenders' standard credit and fraud checks.

Key features include:

Up to £2m per business group (or £1m under the Northern Ireland Protocol)
Broad range of products: including term loans, overdrafts, and asset finance
Commercial pricing: factoring in the government guarantee and associated lender fees
Lender discretion: all decisions remain with the lender, based on their credit assessment

Reinald de Monchy, Co-Chief Banking Officer at the British Business Bank, said: "The Growth Guarantee Scheme and its predecessors have proven themselves to be an important means of supporting smaller UK businesses over the last 40 years. It is therefore important and necessary to see additional capacity made available to support smaller UK businesses at this time."

The government confirmed at the 2024 Autumn Budget over £1 billion in continued funding for the British Business Bank’s programmes through to 2025/26. This includes support for SME housebuilders, start-ups, and scale-up companies in high-growth sectors such as life sciences.

Small businesses can apply through accredited lenders listed on the British Business Bank website. Borrowers are encouraged to approach their existing providers first but may seek alternatives if needed.