Enterprise Finance Guarantee (EFG)

Quick facts

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The Enterprise Finance Guarantee was one of the UK government’s flagship business loan programmes, designed to support lending (up to £1.2m) to businesses that would otherwise be turned down for finance because they have insufficient security to meet a lender’s normal requirements. The programme provides lenders with a government-backed, partial guarantee – this can in theory turn a lender’s ‘no’ credit decision to a ‘yes’.

The government’s Enterprise Finance Guarantee (EFG) programme was designed for businesses that had a good track record but not enough security to get a loan – it’s not meant for startups. The government-owned British Business Bank administrated the programme.

You could’ve applied for an EFG loan via any of the British Business Bank’s commercial partners, which include high street banks, challenger banks and independent lenders. Under the programme, the government guaranteed to take up to 75% of the lender’s net (post-recovery) loss if your business defaulted on payments. This meant the lender was exposed to only part of the risk so, in theory, was more likely to lend to you.

Any lender (or finance provider) would still go through a due diligence process with you before they gave you a loan, but the EFG programme effectively widened the eligibility criteria to help more businesses get finance. 

You payed interest and fees to the lender as you would with any loan. You also payed a quarterly fee to the government. An EFG loan was more expensive than other business loans, but it might make the difference between getting the finance and not.

EFG supported a wide range of loans, including:

You would’ve likely been eligible for EFG support if you:

  • were UK-based
  • had an annual revenue of no more than £41m
  • operated within an eligible industrial sector (a small number of industrial sectors are not eligible)
  • had a sound borrowing proposal and a robust business plan but inadequate security to meet a lender’s normal requirements.

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Disclaimer: Swoop Finance helps UK firms access business finance, working directly with businesses and their trusted advisors. We are a credit broker and do not provide loans or other finance products ourselves. We can introduce you to a panel of lenders, equity funds and grant agencies. Whichever lender you choose we may receive commission from them (either a fixed fee of fixed % of the amount you receive) and different lenders pay different rates. For certain lenders, we do have influence over the interest rate, and this can impact the amount you pay under the agreement. All finance and quotes are subject to status and income. Applicants must be aged 18 and over and terms and conditions apply. Guarantees and Indemnities may be required. Swoop Finance can introduce applicants to a number of providers based on the applicants’ circumstances and creditworthiness. Swoop Finance Limited is registered with the Financial Conduct Authority as an Account Information Services Provider (reference number 833145). Swoop Finance Limited is authorised as a credit broker under FCA registration number 936513. If you feel you have a complaint, please read our complaints section highlighted above and also contained within our terms and conditions. Swoop Finance Ltd is registered with Companies House (company number 11163382, registered address The Stable Yard, Vicarage Road, Stony Stratford, Milton Keynes MK11 1BN). VAT number: 300080279

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