Enterprise Finance Guarantee

Understanding the Enterprise Finance Guarantee Scheme

In welcoming Wednesday’s announcement from the Government of financial support for small and medium sized businesses, the Institute of Chartered Accountants in England and Wales (ICAEW) is urging businesses to ensure they fully understand the differences between a guaranteed loan and an overdraft, which is a more common means of managing cashflow. New research conducted among ICAEW members shows that overdrafts are the most important form of finance for SMEs, with 54% of SMEs surveyed having an overdraft facility compared to 37% having a term loan. Overdrafts are critical for many SMEs to manage cashflow. Around a quarter of SMEs have been contacted by their overdraft provider in the last six months to have the facility renegotiated or cancelled. This compares to only 12% of large bu... »