The British Business Bank (BBB) has opened its Enterprise Finance Guarantee (EFG) accreditation process to lessors after consultations and recommendations made in a review published in April.
The BBB said asset finance providers were invited to apply to the programme, with the aim of increasing the number and diversity of lenders offering EFG-supported borrowing facilities to smaller businesses.
Launched in 2009, EFG encourages lending to viable UK businesses that have been turned down for a loan or other form of debt finance, due to inadequate security. It does this by providing accredited lenders with a government-backed guarantee for 75% of the loan value (subject to a cap on total guaranteed lending across the lender’s total loan book).
The Enterprise Finance Guarantee (EFG) is open to qualifying smaller businesses with turnover of up to £41m (53.45m).
The BBB said it was working with the Finance & Leasing Association (FLA) to widen the scope of EFG to include support for asset finance lending.
Simon Goldie, head of asset finance at the FLA, said: "This announcement will help to ensure that more small and medium-sized businesses will be able to access the finance they need to grow. It is also great to see asset finance growing in profile and use through the government’s lending schemes."
The Enterprise Finance Guarantee currently supports £200m-£300m of finance per annum, delivered to the market via more than 40 accredited lending partners, including all the main high street banks, smaller specialist lenders, invoice finance and community lenders.
Judith Ozcan, managing director, Lending Solutions at British Business Bank, said: "We look forward to welcoming new lenders onto the already-successful Enterprise Finance Guarantee programme. EFG has, since its launch in 2009, supported the provision of more than £2.7bn of finance to more than 25,000 smaller businesses in the UK.
"The expansion of the programme is in response to a key recommendation from the recent review and will help in delivering BBB’s corporate objectives to increase the supply of finance to smaller businesses and to create a more diverse and vibrant finance market."