In a significant boost for UK small and medium-sized businesses, the government has confirmed that the Growth Guarantee Scheme (GGS) will be extended until 31 March 2030. The announcement, made during the 2025 Spending Review, ensures that businesses across the country will continue to have access to government-backed lending for years to come.
What Is the Growth Guarantee Scheme?
The Growth Guarantee Scheme is a government-backed loan programme designed to support access to finance for UK businesses with a turnover of up to £45 million. Under the scheme, the government provides a 70% guarantee to the lender on the outstanding facility amount, reducing the risk for lenders and making it easier for businesses to secure funding.
It is important to note that the borrower remains 100% liable for the debt. The guarantee is between the government and the lender, not the borrower. However, by reducing the lender's exposure, the scheme encourages lending to businesses that might otherwise struggle to access finance through traditional channels.
How Did We Get Here?
The scheme has its roots in the Recovery Loan Scheme (RLS), which was introduced to help businesses recover from the economic impact of the pandemic. The third iteration of the RLS opened for applications on 1 August 2022. Originally due to end on 30 June 2024, the scheme was extended in the 2024 Spring Budget until 31 March 2026 and renamed the Growth Guarantee Scheme on 1 July 2024 to reflect its evolving purpose.
In April 2025, the Chancellor announced an additional £500 million in lending capacity, specifically aimed at smaller businesses that may need support with cash flow issues arising from changes in global tariff rates. The latest extension to 2030 provides long-term certainty for both lenders and borrowers.
The Numbers So Far
The scheme has already delivered substantial results. According to the British Business Bank, GGS has provided £2.89 billion in financing to UK smaller businesses to date. Of that total, £1.98 billion has reached businesses outside London and the South East, demonstrating the scheme's reach across the regions.
More than 70 lenders are now participating in the scheme, creating a diverse and competitive lending market. The previous two iterations of the Recovery Loan Scheme enabled a further £4.33 billion of finance, bringing the total government-backed lending under these programmes to over £7 billion.
What This Means for Your Business
The extension to 2030 is good news for any UK business that may need to borrow in the coming years. Here is why it matters:
Continued access to finance. The scheme ensures that government-backed lending remains available, even if economic conditions tighten. Businesses that might not meet the criteria for a standard commercial loan may still be able to access funding through GGS-accredited lenders.
Support during uncertainty. The additional £500 million in lending capacity was specifically introduced to help businesses manage cash flow pressures caused by global tariff changes. If your business is affected by supply chain disruption or rising import costs, this additional capacity could be relevant to you.
A competitive lending market. With over 70 participating lenders, businesses have a wide range of options when it comes to finding the right finance provider. This competition helps to keep terms fair and accessible.
No change to borrower liability. It is worth reiterating that the guarantee is between the government and the lender. As a borrower, you remain fully responsible for repaying the loan. The scheme does not reduce your obligations, but it does make lenders more willing to offer finance in the first place.
How Paxford Finance Can Help
At Paxford Finance, we work with businesses across the UK to provide fast, flexible, unsecured business loans. We understand that accessing finance can feel daunting, particularly for businesses that have been turned down elsewhere or are navigating a difficult trading period.
Our approach is straightforward. Every application is reviewed by a real person who looks beyond the numbers to understand your business and its potential. We do not rely solely on credit scores or algorithms.
If you are considering applying for a business loan, whether through the Growth Guarantee Scheme or directly, our team is happy to discuss your options. You can reach us at 0333 0506 285 or email [email protected].