The Intermediary – January 2026 - Flipbook - Page 52
SPECIALIST FINANCE
Opinion
The evolving Growth
Guarantee Scheme is
here to stay
F
or many years, it has
been possible to view
the introduction of
UK Government
guarantee schemes
as merely reactive
responses to economic shocks – from
the Enterprise Finance Guarantee,
which supported businesses in the
wake of the 2008 Credit Crunch,
to the more recent pandemic-era
loan programmes.
That narrative has changed,
however, with the recent Government
Spending Review. By commiing
funding to the Growth Guarantee
Scheme (GGS) until March 2030, the
Government has finally placed this
initiative on a long-term footing.
We are moving away from
piecemeal extensions and towards a
recognition that a stable guarantee
scheme is essential for a growing
economy.If you look at the US
or Germany, they have operated
significantly larger, permanent
guarantee programmes for decades.
These aren’t emergency measures;
they can be engines of GDP growth.
The GGS is our opportunity to
replicate that success.
The scheme has already proven
its worth, hiing the £2.5bn lending
milestone in July 2025, with 69%
of that capital flowing to businesses
outside London and the South East.
Despite the scheme’s success, it
remains misunderstood by some in the
intermediary market.
Need to know
The GGS aims to help small and
medium enterprises (SMEs) access
finance for investment and growth
through loans of up to £2m, with a
wide range of products supported by
a broad variety of accredited lenders,
including term loans, overdras, asset
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The Intermediary | January 2026
finance, commercial mortgages and
asset-based lending.
The GGS provides a 70%
Government guarantee to the lender,
with the borrower remaining fully
liable for the loan. This risk reduction
allows us to look at deals where the
borrowing proposition is viable
but perhaps lacks the collateral
or track record for a standard
commercial loan.
That support is invaluable in
sectors where operators may be
strong candidates but lack the
track record or collateral to meet
conventional threshold.
Eligibility is broad, with UK-based
SMEs of up to £45m turnover able to
apply, provided they are not classified
as businesses in difficulty.
Importantly, the GGS complements
rather than replaces standard
commercial lending. If we can offer a
borrower a more suitable loan outside
of the scheme, we will always do so.
Recent Atom cases – such as
supporting a first-time pub owner to
purchase their freehold using business
goodwill in place of a traditional
deposit – demonstrate how the
combination of lender flexibility and
the scheme’s framework can unlock
opportunities that would otherwise
be missed.
Working together
Broker feedback has been central
to shaping our broader commercial
mortgage proposition and that has
been reflected in our GGS criteria,
too. Brokers told us that experienced
professionals in the care and education
sectors were finding it difficult to raise
finance for their first acquisition,
despite having the skills and
commitment needed to succeed.
We will now consider applications
from first-time buyers for all GGS-
TOM RENWICK
is head of business lending
at Atom bank
eligible businesses. We are specifically
targeting sectors with high barriers
to entry but strong underlying
demand, such as day nurseries and
dental practices.
These are vital community services
where capable professionals oen
struggle to make the transition
from operator to owner due to strict
lending criteria.
We have also updated our approach
for Care Quality Commission (CQC)
ratings of ‘Requires Improvement’
within the care sector. Previously, we
required applicants with this rating to
evidence a successful track record of
turning around care homes.
However, brokers told us clearly: the
material backlogs on CQC inspections
are making this challenging.
Operators might have improved a
home’s standards many months ago,
but are still waiting for the inspection
to prove it. We have therefore waived
the requirement to evidence this
track record.
By listening to those insights, we
were able to make changes that will
allow more businesses to access the
funding they need.
The Growth Guarantee Scheme
may not have seen the same fanfare
as its predecessors, but its value is
undeniable. With the scheme now
secured until 2030, we have a longterm runway to support UK SMEs.
However, no Government scheme,
however well-funded, works in
isolation.
To reach its full potential, it requires
the active engagement of brokers and
the agility of lenders – and at Atom we
are ready to do our part. ●
