More Businesses Encouraged to Consider EFG
Business Minister Shriti Vadera today welcomed the Business and Enterprise Select Committee report on the Enterprise Finance Guarantee (EFG), which has seen thousands of businesses benefit from the government guaranteed loan.
Six months after being introduced, well over half a billion pounds worth of eligible EFG applications have been granted or are in the process of being assessed by banks.
Business Minister Shriti Vadera said:
“I welcome this report and the recognition that EFG is helping viable small businesses through this difficult economic time.
I also welcome the committee’s interest in testing experience of businesses with their banks. We will also continue to monitor uptake and performance of the banks to ensure EFG plays its part in getting access to finance for small and medium businesses.
I encourage any small and medium business experiencing difficulty in obtaining a loan or overdraft to talk to banks about the possibility of using the EFG.”
A total of 4,054 businesses have been offered an EFG loan, with an overall value of £400 million.
In January this year the Government expanded its help for small businesses to ensure more firms are eligible to access the finance they need during the recession.
This expansion has helped see lending to small businesses underwritten by the Government in the second quarter of this year reach £197 million, more than four times higher than the £43.6 million for the same period last year.
Cambridge based firm Green Energy Options Limited secured a £1 million EFG loan in March from NatWest to help the energy services business fulfil an order on a multi-million pound contract with British Gas.
Green Energy Options CEO Patrick Caiger-Smith said:
“This contract is a milestone in the company’s history. Since inception we have aimed to promote energy awareness amongst the consumer, business and education markets in the UK and Europe, and this contract extends our reach into new markets which provide real opportunities for us.
“In today’s tough environment there was some trepidation about raising the level of funding required but we have been delighted by the response from NatWest and the flexibility the structuring of the loan under the EFG scheme provides.”
Since the launch of the EFG in January this year, the Government has worked closely with the participating lenders and continued to make improvements to the scheme so that it can respond to the changing needs of small businesses during the recession and beyond.