
Figures from Bridging Finance have found that the government lending facility, aimed at those which have previously been rejected by providers of traditional commercial loans because of a lack of security or “proven” track record, is financing firms that go into default 15 per cent more than normal.
EFG is managed by British Business Financial Services, a wholly-owned subsidiary of British Business Bank, but is “on the balance sheet of the Department for Business, Innovation & Skills”, according to a statement. It provides 75 per cent guarantee to lenders.What you need to know about the Enterprise Finance Guarantee
Bridging Finance is now calling on businesses to review lending exit strategies before securing finance facilities. Going into more detail, Bridging Finance managing director Chris Baguley said: “It seems clear that the EFG model is open to default rates which are approximately 15 per cent higher than expected under commercial lending. “There is no denying that reduced lending from banks has meant many businesses are turning to alternative forms of finance.”- Enterprise Finance Guarantee scheme hits three-year high
- New lenders join Enterprise Finance Guarantee scheme
- Enterprise Finance Guarantee scheme numbers released
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