The British Business Bank’s Growth Guarantee Scheme (GGS) has allocated £27m to Paragon Bank, a specialist lender and savings bank providing a range of products and services in the UK.

Succeeding the Recovery Loan Scheme, the GGS provides accredited lenders with a government-backed guarantee while borrowers remain fully liable for the debt.

It aims to improve access to finance for UK small and medium enterprises (SMEs) seeking to invest and grow.

The additional £27m funding increases Paragon Bank’s total lending capacity under the scheme to £55m.

Of this, £10m is designated specifically to support UK businesses affected by changes in international trade tariffs.

A targeted £7m fund has been set aside for businesses impacted by shifting trade tariffs, particularly in sectors such as manufacturing, which have faced increased costs and supply chain complexities.

Paragon has so far provided over £40m in GGS-backed funding to more than 300 SMEs, supporting investment and growth in sectors including construction, transport, and agriculture.

The new allocation will allow Paragon to further expand its support, offering both unsecured loans and asset-based finance to businesses that may struggle to access capital.

Paragon Bank SME Lending deputy managing director Phil Hughes said: “The additional funding from the British Business Bank is a welcome boost and a clear vote of confidence in our ability to deliver meaningful support to UK SMEs.

“We’ve already seen the transformative impact of the Growth Guarantee Scheme, and with this new allocation, we’re ready to support even more businesses on their growth journeys.”

In a separate development, UK bank Aldermore has confirmed its accreditation as a lender under the invoice finance and term loan variants of the GGS, having previously participated in the Recovery Loan Scheme.

For its invoice finance offering, Aldermore provides a maximum facility of £2m per business group, with a fixed value up to the facility review limit, as determined by the bank.

Facility limit increases may be considered for extraordinary events, but cannot include inter-company debt, aged debtors, or disputed debt.

Aldermore’s Term Loan offering under the GGS operates alongside its invoice finance facility, providing loans ranging from £25,000 to £2m per business group, with term lengths available from three months to six years.

Aldermore invoice finance business development head Chris Meldrum said: “As a long-standing partner in government-backed lending schemes, it’s a natural step to now offer the invoice finance variant of the Growth Guarantee Scheme.

“This initiative allows us to continue providing vital financial solutions that help businesses invest, scale, and drive economic growth.”

"Paragon secures £27m in funding for SME lending" was originally created and published by Leasing Life, a GlobalData owned brand.

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