LOANS OFFERED BY FLAGSHIP SMALL BUSINESS SCHEME FALLS TO RECORD LOW
March 12th, 2019.



Small businesses have been urged to use a declining government lending scheme to plug any Brexit-related funding gaps.


The value of loans offered by the Enterprise Finance Guarantee (EFG) scheme fell to a record low of£55.6 million in the final quarter of 2018, according to research from online business finance marketplace Funding Options.

The amount was 78 per cent down on the scheme’s peak of £255 million in the second quarter of 2009, and 2.2 per cent down on the same period in 2017.

The Enterprise Finance Guarantee scheme was launched in 2009 to help small and medium-sized businesses access bank lending following the credit crunch. The scheme provides loans to businesses that don’t have enough security to meet traditional lenders’ normal requirements. The government provides a guarantee worth 75 per cent of the loan to lenders to underwrite their risk.

Funding Options chief executive Conrad Ford said: “The EFG was a successful concept when it was launched but it is now having less and less of an impact. The EFG was a saviour of many small businesses during the last credit crunch.”


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