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Government scheme helps over 5,000 firms

Over 5,000 small businesses secured loans under the government’s Enterprise Finance Guarantee scheme during its first year of operation, with over £580million lent during 2009.

The scheme, introduced in January 2009, sees the government guarantee up to 75 per cent of loans to companies with an annual turnover of up to £25million, which are looking to borrow up to £1million.

Those funds can be used for investment in the business, or to refinance existing borrowing.

Richard Hurst, Director, said “A recent report by Durham University into the effectiveness of the scheme found that 94 per cent of respondents said the loan had improved their business prospects, while 84 per cent said it had improved their prospects of survival”.

Trade, Investment and Small Business Minister Lord Davies said, “These impressive results show the Government is providing real help to businesses when they need it, helping to secure jobs and give businesses the capital they need to invest and grow.

“The Enterprise Finance Guarantee has been welcomed by business and, following its recent extension, it will continue to play a vital role in encouraging enterprise and investment and driving productivity and growth throughout the UK economy.”

In last month’s pre-Budget report, the Chancellor, Alistair Darling, announced that the EFG would continue for at least another year, with another £500million being made available.

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