The Small Firms Loan Guarantee Scheme (SFLGS) makes it possible for small businesses with a viable business proposal, but lacking security, to borrow money from approved lenders. Some small businesses with workable business proposals may have difficulty in getting conventional loans because they cannot offer sufficient assets as security against the loan. The UK Government through the Small Firms Loan Guarantee Scheme, helps by providing a 'guarantee' to the lender. The Small Business Loan Guarantee Scheme is a join venture between the DTI and approved lenders. It is administered by the Small Business Service (SBS), an agency of DTI. The loans are provided by the approved lenders who make all the commercial decisions about the loan application and SBS cannot intervene in that commercial process.

Overview of the current scheme

• A UK-wide, Government backed scheme which guarantees 75% of the loan for eligible companies.
• Only guarantees loans to businesses that are unable to obtain conventional finance because of lack of security.
• The minimum loan amount is £5000 and the maximum loan amount is £250000.
• The business pays the Government a premium of 2% per year on the outstanding loan amount.
• The loan term can be between 2 - 10 years. It also allows staged payments and capital repayment holidays.
• Most business types are allowed including sole traders, Partnerships and Limited companies.
• Size of business - Maximum turnover of £5 million for manufacturers and £3 million for all other businesses. Employee size not to exceed 200.
• Loans are available for most business purposes although there are some restrictions (contact us for further details)

Some useful tips and information

• Business Plan Guide - 10 Questions your business plan should answer
• Useful Excel Templates
• Xpress News Alert service (e-mail based)

Contact Us - FREE consultation

If you are interested in finding out more about the small firms loan guarantee scheme free of charge and without obligation then please contact us or telephone us on (020) 7016 9775. An experienced consultant will get in touch with you promptly and provide answers to your questions.

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Last modified: 31/01/2005 09:01:31