22nd May 2012
Where do you get your share of the £20 billion?
13th Feb 2009
We all heard it on the news and UK banks now apparently, have £20 billion more to lend to small businesses – but how do you get your share? But how can you go about accessing available funding?
The business loan schemes announced by the government in January are fine in principle but getting the money out of the banks may be a different story. Effectively the government is providing guarantees that small business loans will be repaid in order to encourage the banks to lend more – but they can’t force them to advance money to any specific business.
For smaller firms, with up to £25 million turnover, a further £1.3 billion is available through the Enterprise Finance Guarantee scheme. This is designed to enable businesses to secure loans of up to £1 million, which will repayable over 10 years. The government will guarantee 75 per cent of these funds.
A third element of the announcement saw a further £75 million being allocated for the Capital for Enterprise Fund – two thirds of which will be provided by the government, one third by the banks. This is a sort of public venture capital fund, which enables businesses to sell their debt in exchange for equity. In other words, they hand over a share in their business in exchange for the government taking on some or their debt. Aimed at companies with a turnover of up to £50 million it will provide funding of as much as £2 million.
If you want to find out more about how you can apply for support under the Working Capital Scheme and the Enterprise Finance Guarantee Scheme you do need to go to your bank.
Businesses can register for the Capital for Enterprise Fund by calling
0845 459 9780
