London: +44 (0)20 7236 2601
St Albans: +44 (0)1727 869141
Rickmansworth: +44 (0) 1923 771010
Milton Keynes: +44 (0)1908 605552

Enterprise Finance Guarantee (EFG) & Personal Guarantees

There is much confusion over the requirement for guarantees under the Enterprise Finance Guarantee (EFG) scheme.

The Bank must be satisfied that all available personal assets have been pledged, before lending under the EFG scheme. However it is at the banks discretion to determine whether:

  • Personal assets may be considered ‘available’ as security (see below)
  • The applicant is personally committed to the venture
  • The applicant is using the EFG solely to avoid pledging personal assets.
If personally owned assets that would be traditionally offered as security are jointly owned with a spouse/third party, who is not directly connected to the business a refusal by the third party to charge those assets should be sufficient to render these assets as ‘unavailable’ for conventional lending.
If the principal residence is not jointly owned, and the applicant refuses to offer this as security, then the EFG scheme can still be used at the discretion of the lender. In these cases, an unsupported personal guarantee would likely be sought. An existing loan may not be refinanced with a new EFG-backed loan for the purpose of releasing the security previously provided.

The EFG is new ground for all of us. Good luck, and please leave comments if you have any interesting observations on the application process.



Date: 20th March, 2009
Author: Julian Dobbin


Articles from this Author

Contact Business Service Partners

Choose from the drop down menu below to select a Partner to contact.


Mercer & Hole’s @GudgionJa progress in @CelebJustDance - Not much longer to Waite now….. @MKDonsSET

Mercer & Hole’s Michael Lapham impresses at the @MoneyMgmtMag Financial Planner Awards…



For the latest Mercer & Hole news, visit our LinkedIn page mercer-&-hole

Click here to follow us on LinkedIn