Enterprise Finance <br />Guarantee Scheme

Enterprise Finance Guarantee

The Enterprise Finance Guarantee Scheme (EFG) was introduced in 2009 by the Government to help businesses gain access to finance in cases where they have previously been turned down for a commercial loan due to lack of security. The Government guarantees 75% of the loan value thus encouraging financiers to lend to businesses. The Government though takes no part in the decision-making process.

An EFG can be approved by a wide range of Banks and other financial institutions and the procedures for applying are very similar to any loan application:

1. A completed application form

2. A business plan

3. Cashflow forecasts

4. Evidence that the loan repayments are affordable - remember, even though the Government guarantees 75% - you are responsible for the full value of the loan

5. A personal guarantee will usually be required from the directors of the business


The business must:

- have an annual turnover less than £41m

- trade within the UK

- be seeking finance in the region of £1k to £1m with repayment terms between 3 months and 10 years.


These will vary depending on the loan amount and the repayment terms, but it should be remembered that there is an additional 2% annual premium charged to contribute to the cost of providing the guarantee.

 An EFG is a great way to inject working capital into an existing business and can be used alongside a factoring or invoice discounting facility to improve your cashflow further. 


  • Few restrictions on loan use
  • Businesses in most sectors are eligible to apply
  • Repayment terms range from 3 months to 5 years
  • You retain control by utilising your assets to maximise finance as an alternative to equity finance

If you would like to know more about the Enterprise Finance Guarantee, call us on 0845 180 1188