If you have a viable business plan but are struggling to secure the finance to start or expand your business, the Small Firms Loan Guarantee Scheme might be able to help.

Run by the Small Business Service (SBS), the scheme is for people who have tried and failed to get a conventional loan because they are unable to provide the necessary security that banks and finance companies expect.

The scheme is open for firms with an annual turnover of no more than £5.6 million and will guarantee 75% of a loan.

The scheme covers loans of £5,000 to £100,000 (£250,000 if a business has been trading for more than two years) over periods of two to 10 years.

In exchange, the borrower pays the SBS a premium of 2% per year for the outstanding amount of the loan.

Loans are available for most types of businesses and purposes, but there are some exclusions and restrictions and companies should to check their eligibility before applying. The following banks and lenders are signed up to the scheme and applications should be made directly to them:

  • Bank of Ireland
  • Bank of Scotland
  • Barclays Bank
  • Clydesdale Bank
  • Co-operative Bank
  • Doncaster Business Advice Centre
  • First Trust Bank/Allied Irish Banks
  • Lloyds TSB Group
  • London Enterprise Agency (LEntA)
  • HSBC Bank
  • Northern Bank
  • National Westminster Bank
  • Northern Venture Managers Ltd
  • Royal Bank of Scotland
  • State Securities plc
  • Triodos Bank nv
  • UK Steel Enterprise
  • Ulster Bank
  • Venture Finance plc
  • Yorkshire Bank
  • Yorkshire Enterprise Ltd

    More information on the scheme is available from the SBS at www.sbs.gov.uk or by contacting 0114 259 7308/9