Enterprise Finance Guarantee (EFG)

Government-backed Bank Lending to Small Firms Plummets

Bank lending to small businesses under the Government’s Enterprise Finance Guarantee (EFG) scheme has fallen by 42 per cent in the past 12 months, new figures have revealed. Research from financial services group Syscap found that the total value of loans offered to small firms under the EFG scheme fell from £742 million to £433 million in the 12 months to 30 June 2011. The EFG scheme was introduced by the Government in 2009 with a target of lending £1.3 billion to viable businesses with a turnover of up to £25 million. Under the terms of the scheme, banks are advised to lend to businesses they would be happy to lend to commercially, regardless of the guarantee from the Government. Syscap’s research found that just £93.1 million was made available ... »