United Kingdom HM Treasury has announced a package of reforms to expand access to finance for small and medium-sized enterprises, centered on a major expansion of the British Business Bank’s Growth Guarantee Scheme. The scheme, which provides a 70% government guarantee on commercial loans to SMEs of up to GBP 2 million, will be scaled to support an additional GBP 2 billion of lending a year by 2028/29, taking total annual lending backed by the scheme to GBP 3.35 billion from GBP 1.35 billion. HM Treasury said the changes should support 12,000 additional businesses a year by 2028/29, raising the total number supported to 20,000. The package also extends the maximum loan term under the scheme to 10 years from six for loans of up to GBP 1.1 million and raises the annual turnover cap for eligible businesses to GBP 54 million from GBP 45 million. Beyond the Growth Guarantee Scheme, the British Business Bank has allocated GBP 500 million of capacity within its ENABLE Guarantee programme to support lending to innovative and intellectual property rich SMEs and scaling firms. Additional measures include a new joint portfolio guarantee from UK Export Finance and the British Business Bank for SME exporters, further support for Community Development Finance Institutions through the Community Finance Taskforce and the Community ENABLE Funding programme, a plan to remove legislative barriers for building societies that want to lend to SMEs, and a commitment to accelerate work on Open Finance with an initial focus on SME lending. Next steps set out in the package include launching the export finance guarantee in spring next year, opening a second phase of Community ENABLE Funding later this year, and publishing a Community Finance Taskforce roadmap early next year. The government also said it will consult in 2027 on how to deliver Open Finance in the UK and will publish a formal consultation on ring-fencing reforms, including a New Growth Allowance, as part of the Chancellor’s Mansion House speech.

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