I am tabling this statement for the benefit of Honourable and Right Honourable Members to bring to their attention the details of the Growth Guarantee Scheme (GGS), which will replace the Recovery Loan Scheme on 1 July 2024 and run until at least 31 March 2026.

The Growth Guarantee Scheme is facilitated by the Government-owned British Business Bank and delivered through its delivery partners. Under the scheme, lenders will offer facilities of up to £2 million to support businesses that would otherwise be unable to access the finance they need, or would only be able to do so on worse terms. The scheme is forecast to facilitate £2.19 billion of finance between 1 July 2024 and 31 March 2026.

Some notable features of GGS are as follows:

• The maximum amount of external finance available will be £2 million per business in Great Britain; for businesses in scope of the Windsor Framework, the maximum amount will be £1 million per business.
• To lend through the scheme, lenders will be required to certify that they would not have been able to offer a facility to the business on their normal commercial terms, or that they would have only been able to do so at a higher interest rate.
• Personal guarantees will be permitted, but not required, for all facilities in line with delivery partners’ usual policies. Principal private residences may not be used as security under any circumstances.

The minimum facility size will be £25,001 for loans and overdrafts and £1,000 for asset and invoice finance products. Businesses will be required to meet the costs of interest payments and any fees from the outset. The lender must establish that the borrower has a viable business proposition assessed according to its normal commercial lending criteria. Businesses who have made use of the previous Coronavirus loan schemes, or the Recovery Loan Scheme, will be able to access the scheme.

Given the above, the maximum contingent liability for the forecast £2.19 billion scheme is £1.533 billion.

I will be laying a Departmental Minute today containing a description of the liability undertaken.