NEWS

Finance package for small businesses

Significant reforms to small business finance have been announced by the government.

The centrepiece of the plans is an expansion of the British Business Bank’s (BBB) Growth Guarantee Scheme (GGS) which provides a 70% government guarantee on commercial loans to SMEs of up to £2 million.

The scheme will scale up to facilitate an additional £2 billion of SME lending per year by 2028/29. This will bring the total SME lending supported through the scheme to £3.35 billion per year, more than double the current £1.35 billion.

The maximum term length of a loan is also increasing from six to ten years for loans of up to £1.1 million.

In addition, the maximum size of businesses that are eligible for a loan under the scheme is rising from £45 million in annual turnover to £54 million.

The BBB estimates these changes will support an additional 12,000 businesses per year by 2028/29, a 150% increase on the 8,000 currently being supported, bringing the total to 20,000.

Louise Hellem, Chief Economist at the Confederation of British Industry, said:

‘The government deserves credit for listening to business and putting forward a package that recognises the practical finance challenges firms face. The priority now is delivery and making sure the support is simple to access, well understood by businesses and effective in crowding in private capital.

‘If implemented well, these reforms can help more SMEs scale, export and adopt new technologies here in the UK – supporting productivity, stronger local economies and long-term growth.’

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20/07/2026