Ryan FowlerThe Chancellor has announced that the British Business Bank’s Growth Guarantee Scheme will receive additional capacity to support around £500m of extra lending for smaller UK businesses affected by changes to global tariff rates.
The funding boost is specifically aimed at businesses experiencing cashflow challenges due to tariff disruptions, providing vital support for workplace stability during economic uncertainty.
Businesses can access funding of up to £2m through approximately 50 accredited lenders, with the scheme providing lenders a 70% government-backed guarantee. This enables financial institutions to support viable smaller businesses that might otherwise struggle to secure necessary funding. Companies can use the finance for managing cashflow or working capital requirements due to tariff-related disruption, though they must demonstrate ability to take on additional debt.
The Growth Guarantee Scheme offers a range of financial products including term loans, overdrafts and other solutions that help address cashflow challenges. Decision-making is delegated to individual lenders, who must conduct standard credit and fraud checks. Businesses are advised to approach their own provider first, ideally via the lender’s website, though they may consider other accredited lenders if unable to access needed finance.
Reinald de Monchy, co-chief banking officer, 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 forty years.
“The Growth Guarantee Scheme can be used counter-cyclically, enabling smaller businesses to obtain funding during times of uncertainty such as we are experiencing currently. It is therefore important and necessary to see additional capacity made available to support smaller UK businesses at this time.”
The Government confirmed over £1bn of funding for the British Business Bank at Autumn Budget 2024 to continue its programmes throughout 2025/26.
