Your Complete Guide to the Growth Guarantee Scheme (GGS)

The Growth Guarantee Scheme (GGS) gives UK businesses access to loans backed by a 70% government guarantee. Launched on 1 July 2024, it's designed to help small and medium-sized businesses secure the funding they need to invest and grow - often on more favourable terms than standard commercial lending.

Here's what you need to know:

• Borrow from £1,000 to £2 million
• Available until 31 March 2030
• 70% government guarantee to reduce lender risk
• Open to businesses with turnover up to £45 million
• Supports a wide range of finance products
• Previous COVID scheme borrowers can still apply

How the Growth Guarantee Scheme Works

Managed by the British Business Bank on behalf of the Secretary of State for Business and Trade, the GGS aims to support around 11,000 UK businesses.

The GGS replaces and builds on the Recovery Loan Scheme. While the original scheme focused on helping businesses recover from the pandemic, the GGS is designed to support long-term business investment and expansion.

The Government Guarantee

A 70% government guarantee is provided to lenders on the outstanding balance of eligible facilities.

The guarantee is for the lender only. Businesses remain fully liable for 100% of the amount borrowed.

Loan Amounts:

• Minimum: £1,000 for asset finance, invoice finance and asset-based lending; £25,001 for term loans and overdrafts

• Maximum: £2 million per business group (£1 million for Northern Ireland Protocol borrowers)

Term Lengths:

• Term loans and asset finance: 3 months to 6 years

• Overdrafts and invoice finance: 3 months to 3 years

Supported Finance Products

The GGS can be used for:

• Term loans

• Overdrafts

• Asset finance

• Invoice finance

• Asset-based lending facilities

Why Businesses Use the GGS

Improved Terms: Lenders may offer more competitive pricing thanks to the government guarantee. If they can offer a better commercial deal without the scheme, they will.

No Primary Residence Security: Your primary residence cannot be taken as security under the scheme.

Flexible Use: Facilities can be used for any legitimate business purpose, including managing cash flow, investment, asset purchases, and growth.

Green Initiative: Enhanced support is being trialled for businesses investing in eligible sustainable assets. (Green GGS).

Eligibility Criteria

Core Requirements

To qualify, your business must meet all the following eligibility criteria:

1. Turnover Limit
   Turnover of up to £45 million (on a group basis if applicable).

2. UK-Based Trading
   Must carry out trading activity in the UK.
   Most applicants must generate over 50% of income from trading (charities and FE colleges exempt).

3. Business Viability
   The lender must believe that you have a viable business proposition.

4. Financial Health

   Not in difficulty or insolvency proceedings.

5. Subsidy Compliance

   Written confirmation required that the facility will not exceed subsidy limits

Who Isn’t Eligible?

Certain organisations cannot apply, including:

• Banks, building societies, insurers and reinsurers (excluding insurance brokers)

• Public sector bodies

• State-funded primary and secondary schools

Previous Government Scheme Borrowers

If your business previously took out CBILS, CLBILS, BBLS or RLS funding before 30 June 2024, you can still access GGS. However, existing facilities may reduce the maximum amount available.

Any RLS or GGS loans taken after 1 August 2022 will also count towards your cumulative subsidy limit.

How to Apply

Step 1: Speak to a Finance Specialist

We take the time to understand your business and confirm GGS eligibility, including turnover, trading history and subsidy position. Our consultative approach ensures we identify the right funding options from the outset.

Step 2: Receive a Tailored Finance Solution

With access to a wide panel of accredited lenders, including major banks and specialist providers, we source the most suitable GGS-backed facility, up to £2 million.

Not all lenders offer the same products or terms, so we compare options and present a clear, bespoke proposal aligned with your business goals.

Step 3: Prepare Your Documentation

We'll guide you through the documents lenders typically require, such as:

• Previous subsidy awards

• Financial statements and management accounts

• Evidence of affordability

• Business plan or use of funds

• Company accounts

• Director information

Our support helps avoid delays and keeps the process efficient.

Step 4: Application & Assessment

We'll submit your application, and lenders carry out eligibility, affordability, credit and fraud checks. Throughout, we keep you updated so you know exactly where things stand.

Step 5: Get Your Funding

Decisions can arrive within hours, with funds usually released within 48 hours of acceptance. Our Sales and Operations teams work closely with lenders and suppliers to ensure a smooth journey from proposal to payout.

Interest Rates and Fees

Rates depend on your business’s risk profile, financial performance, chosen product, and loan term.

The lender's pricing takes into account the government guarantee benefit, meaning GGS rates are often more competitive than standard business finance. Many lenders charge no early repayment fees.

Personal Guarantees and Security

Personal guarantees may be required depending on the lender, though your main residence cannot be taken as security. Other business assets or property may be considered instead.

Additional Considerations

Start-ups: Eligible at lender discretion. Businesses under three years old may benefit more from the Start Up Loans programme (£500-£25,000 at 6% p.a.).

Refinancing: GGS facilities can be used to refinance existing debt under specific conditions, with or without increasing the initial borrowing amount. 

Multiple facilities: You may access several GGS-backed facilities provided you remain within the overall borrowing limit.

Common Questions Answered

What is the Growth Guarantee Scheme?

The Growth Guarantee Scheme (GGS) is a UK government-backed initiative that helps businesses access funding supported by a 70% government guarantee, making it easier for SMEs to secure loans and finance for growth and investment.

How does the scheme work?

The scheme provides lenders with a 70% government guarantee on eligible loans, enabling them to support more businesses with confidence. If a borrower cannot repay, the government covers 70% of the lender’s losses, but the business remains fully liable for the entire loan amount.

Who can apply?

The scheme is available to UK-based businesses with a turnover of up to £45 million, provided they are financially viable and not in financial difficulty.

Can I apply if I've been refused credit before?

Yes. Even if you’ve been declined previously, you may still be eligible, as each application is assessed individually by lenders.

Will there be credit checks?

Yes. Lenders will carry out credit checks, and in some cases fraud checks, though the type and extent of these checks may vary between providers.

For more information, visit the Growth Guarantee Scheme FAQs.

Tips for a Successful Application

1. Demonstrate Viability: Present a clear plan for how funding will support growth.

2. Check Your Subsidy Position: Ensure you understand your subsidy position.

3. Compare Lenders: Products, terms, and rates differ widely.

4. Prepare Documentation Early: Having full documentation ready speeds up approval.

Need Support Navigating the Growth Guarantee Scheme?

The GGS offers valuable opportunities for businesses seeking funding, but understanding eligibility, subsidy rules, and lender differences can be complex.

Charles & Dean can help:

• Assess eligibility and subsidy position
• Match you with suitable accredited lenders
• Guide you through the application process
• Help you prepare the key documentation
• Compare offers to secure the best available terms

If you're exploring funding options or want tailored guidance on the Growth Guarantee Scheme, our team is ready to support you.

Book a no-obligation consultation with Charles & Dean to discuss how the GGS could help drive your business growth. Contact us now or call 01780 763836.