Growth Guarantee Scheme – Your top questions answered

The Growth Guarantee Scheme (GGS), the government-backed finance scheme, launched on 1st July 2024. Here is everything you need to know.

What is the Growth Guarantee Scheme? 

The GGS is the successor to the Recovery Loan Scheme. It is designed to help UK small businesses get the finance they need to invest and grow. 

What size loan could I get under the Growth Guarantee Scheme?

The GGS can generally support facility sizes of up to £2m, although it will vary by provider.

How long can I borrow under the Growth Guarantee Scheme?

We provide loans under the GGS with terms from two years to six years.

How much will a Growth Guarantee Scheme loan cost?

The amount your GGS loan will cost will depend on how much you want to borrow, your interest rate and your loan term.

We charge a one-off completion fee when you take out your loan, and your interest rate will be calculated based on a number of factors, including your credit score and financials for business lending, and the benefit of the government guarantee.

We won’t charge a fee if you want to settle the loan early, and all our loans are fixed rate, so you’ll know exactly how much you’ll need to repay each month and what the cost of borrowing is.

How does the government-backed guarantee work?

The GGS provides lenders with a 70% government-backed guarantee against the outstanding balance of the debt after it has completed its normal recovery process. 

That means if the business that takes a loan is unable to repay the debt, the lender can recover some of the funds from the government. This allows lenders to approve more loan applications and help more businesses.

Please note that the guarantee is to the lender, not the business, and you are always 100% liable for the debt.

Am I eligible for the Growth Guarantee Scheme?

To be eligible to apply for the GGS with Funding Circle, you must:

• Have a turnover of less than £30 million

• Have been trading in the UK for a minimum of 2 years

• Be a limited company

• Use the loan for a business purpose such as working capital or investment

• Not be in difficulty or have any collective insolvency proceedings ongoing

How will Funding Circle assess whether my business is eligible for the Growth Guarantee Scheme?

When you complete our online application, we’ll assess your business based on the information you provide. The loan offer we make is determined by a number of factors which we review as part of your credit assessment, including the information you provide as well as publicly available data, for example from credit bureaus.

Depending on your business’ financial profile, the best offer we can make may be for a different amount, or a different length term than you originally applied for. If we are able to make you a loan offer without using the guarantee offered by the GGS, we will do so.

Do I need to provide a personal guarantee for a Growth Guarantee Scheme loan?

We ask for a personal guarantee on all loans, including those taken under the GGS. However, Principal Private Residences cannot be taken as security under the Scheme.

What products are available under the Growth Guarantee Scheme?

GGS supports business loans, asset based lending and invoice financing. At Funding Circle we offer GGS business loans.

GGS-backed facilities are provided at Funding Circle’s discretion, and we are required to undertake our standard credit and fraud checks for all applications.

How does the government subsidy work?

GGS loans are supported by a government guarantee and count as a form of subsidy. There are limits on the amount of subsidy a business, and its wider group, can receive over any rolling three year period.

You can find more information on this on the British Business Bank’s website, or in your Subsidy Certification document if and when you accept a loan offer.

Businesses will need to provide written confirmation that by taking a loan under GGS, they have not exceeded the amount of subsidy they are allowed to receive. All businesses in receipt of a subsidy from a publicly funded programme should be provided with a written statement confirming the level and type of aid received.

I already have a CBILS, BBLS or RLS loan – am I eligible to apply for the Growth Guarantee Scheme?

If you took out a loan under the Coronavirus Business Interruption Loan Scheme (CBILS), Bounce Back Loan Scheme (BBLS) or Recovery Loan Scheme (RLS) before 30th June 2024 you are still eligible to apply for the GGS.

The amount you have borrowed under a previous government scheme may reduce the maximum amount you are eligible for under the GGS. 

What happened to the Recovery Loan Scheme?

The first two iterations of the Recovery Loan Scheme – designed to help UK businesses access finance as they recovered from the Covid-19 pandemic – supported £4.3bn of finance to smaller UK businesses.

The third iteration of the scheme offered more than £1bn of finance between its launch in August 2022 and its closure at the end of June 2024. It was replaced with the GGS on the 1st July 2024.

If you’re looking for finance to help your business go further, check your eligibility in just 30 seconds here.

01/12/25: While we want to help as much as we can, the information found here is provided solely for informational purposes and should not be considered financial or legal advice. To the extent permitted by law, Funding Circle does not accept any liability for any loss or damage which may arise directly or indirectly from the use of, or reliance on, the information contained here. If you have any questions, please speak to your professional adviser or seek independent legal advice.