In a recent report by Boost Capital, it confirmed that a number of SMBs being approved by the Government’s Enterprise Finance Guarantee (EFG) scheme, has decreased to its lowest figure ever.
The scheme’s highest peak period, between April and June 2009, saw over 2,000 loans worth over £200m approved. The EFG scheme has since seen a massive dwindle in numbers. In the whole of 2015, there were just 1835 businesses were granted a loan, with 446 in the last quarter.
In the recent budget announcement, the chancellor has extended the EFG scheme until 2018.
Alex Littner, Managing Director of Boost Capital, commented:
“The budget was positioned with small businesses at its heart yet the Enterprise Finance Guarantee scheme that was designed to serve capital-starved small businesses cannot be heralded a success when lending continues to fall.
“Ironically, there are more sources of financial help for small and medium enterprises now than ever before, but the government needs to push schemes like EFG and bank referral scheme to help small businesses locate this much needed capital.”
The Enterprise Finance Guarantee is open to small and medium-sized firms that have a turnover of less than £41 million and are seeking finance between £1,000 and £1.2 million.
What criteria is needed to be eligible for the EFG lending scheme?
EFG is open to UK small and medium-sized firms that have a turnover of less than £41 million and are seeking finance between £1,000 and £1.2 million.
It is open to viable businesses that can afford to repay over a period of between three months and 10 years for term lending and between three months and three years for overdrafts and other revolving services.
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