Lord Mandelson updates on success of Government Guarantee scheme
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Issued Date: 23 Mar 2009
Business Secretary Lord Mandelson today welcomed the success
of the Government' Enterprise Finance Guarantee with more than 1,300
eligible loans worth almost £145 million being processed through the
Lord Mandelson added that as awareness grew the value of
eligible loans had increased ten-fold, from less than £3 million in
week one to around £30 million a week recently. The EFG delivery update
was discussed at the latest meeting of the Small Business Finance Forum.
Lord Mandelson said:
"These figures are good news, showing the Enterprise Finance
Guarantee is providing real help to businesses. The scheme has taken
off since its launch in January with registered lenders now seeing a
ten-fold increase in loan demand.
"However, we must continue to work with all 26 lenders signed
up to the scheme to ensure frontline staff are offering it where
appropriate to small companies across the country."
Lord Mandelson also unveiled the key findings of the
Department's first "mystery shopper" exercise which tested lenders on
staff awareness, understanding and promotion of EFG.
The results revealed that three-quarters of business advisers
had a detailed awareness and understanding of the EFG's features and
The top four lenders agreed to use the results to increase
awareness amongst frontline staff.
1. The Enterprise Finance Guarantee (EFG) is a £1bn loan
guarantee scheme delivered through banks and other lenders that will
enable an additional £1.3bn of lending to business up to the end of
2. The EFG scheme provides a 75% government guarantee on
individual loans of up to £1m to viable businesses with an annual
turnover of up to £25m.
3. The guarantee can be used to support new loans, refinance
existing loans or to convert part or all of an existing overdraft into
a loan to release capacity to meet working capital requirements.
4. The scheme was launched on the 14 January 2009. There are
26 lenders registered to offer it: Airdrie Savings Bank, Alliance and
Leicester, Commercial Bank, Bank of Baroda, Bank of Ireland (NI only),
Bank of Scotland, Barclays, Business Enterprise Fund, Business Finance
Solutions, Clydesdale Bank, The Co-operative Bank, DSL Business
Finance, GLE oneLondon, HSBC, Lloyds Group, NEL Fund Managers, Northern
Bank (NI only), The Royal Bank of Scotland/Natwest, State Securities,
South West Investment Group, Triodos Bank, UK Steel Enterprises, Ulster
Bank (NI Only), Venture Finance, Whiteaway Laidlaw Bank, Yorkshire Bank.
5. The Mystery Shopper exercise consisted of 207 interviews by
telephone and face-to-face of lenders business advisors and reception
staff, between 2 - 13 March. For the interviews different business
scenarios were established ranging from enquiries based on proposals
for modest start-up finance to existing firms seeking larger amounts of
6. For more information and to find out about the support
available go to http://www.businesslink.gov.uk/re
alhelp or call 0845 600 9006.
About the Author
© Crown Copyright. Material taken
from the BERR- Department for Business, Enterprise and Regulatory
Reform replacing DTI - Department for Trade and Industry. Reproduced
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Article Published/Sorted/Amended on Scopulus 2009-03-25 17:26:28 in Business Articles