How the Growth Guarantee Scheme works
The Growth Guarantee Scheme (GGS) is a UK government scheme, run by the British Business Bank, that helps smaller businesses get finance. Accredited lenders offer term loans, asset finance, overdrafts, invoice finance and asset-based lending, and the government guarantees 70% of each facility to the lender.
The guarantee protects the lender, not the borrower. The business must repay 100% of the debt, so this calculator never reduces your costs for it. The lender decides whether to lend and sets the interest rate and fees. Lenders may take personal guarantees, and the scheme is scheduled to run until 31 March 2030.
Worked example
A business has a £100,000 overdraft limit at 9% and draws £40,000 from 1 November 2026 to 30 January 2027, which is 90 days. Interest is £40,000 × 9% × 90 ÷ 365 = £887.67. The same overdraft used to 25% of the limit for the same time costs £554.79 in interest.
If it draws another £20,000 on 1 December and pays £30,000 in on 15 December, the balance is £40,000 for 30 days, £60,000 for 14 days and £30,000 for 46 days, and interest falls to £843.29. The limit does not set the cost. The balance and the days do.
Limit and amount drawn
A £100,000 overdraft limit does not mean £100,000 is borrowed continuously. Interest is charged on the balance you use. Fees such as an arrangement fee or a yearly facility fee are separate, and this calculator charges the share of the yearly fee for the days you borrow.
Lenders set the rate, the number of days in their year (usually 365, sometimes 360) and the fees.
Under GGS, overdrafts are available for up to three years and start at £25,001.
Hospitality and transport businesses often need working capital: see GGS for hospitality businesses and
Running a haulage or storage business? See GGS for transport businesses.
Borrowing limits and recent changes
The published limit is generally £2 million per business group, counting GGS and Recovery Loan Scheme borrowing since 1 August 2022. Term loans and overdrafts start at £25,001, and asset finance, invoice finance and asset-based lending from £1,000. In Northern Ireland, borrowers within the scope of the Windsor Framework can borrow up to £1 million in most sectors, £285,000 in primary agriculture and £170,000 in fisheries and aquaculture. Being in Northern Ireland does not by itself set the limit, and your lender confirms which applies. England, Scotland and Wales follow the same UK-wide limits.
On 12 July 2026 the Chancellor announced that GGS will support facility terms of up to ten years for term loans and asset finance, that the annual turnover limit rises from £45 million to £54 million, and £6.5 billion more lending over four years. The British Business Bank is working with accredited lenders to bring these in and says the scheme remains fully operational under its existing terms, so not every lender offers them yet.
How this calculator works
Interest for each stretch of days with the same balance is the balance × the yearly rate × the days ÷ days in the lender's year, and the stretches are added up. It does not model interest being charged to the account and compounding, so it is an estimate and not a bank statement.
Use it to compare how much a facility could cost at different levels of use. This is an independent tool, not run or endorsed by the British Business Bank or the UK government, and it does not tell you whether you will be approved. To find a lender, use the British Business Bank's official list of accredited lenders, which you can filter by region and type of finance.
For an overdraft that isn't under the scheme, use the overdraft interest calculator.
If your cash flow problem is unpaid invoices, see the GGS invoice finance calculator.
Inputs for the GGS overdraft calculator
Where is the business based?
England, Scotland and Wales share the same limits. Choose Northern Ireland to apply its separate limits.
Northern Ireland borrower type
Shown for Northern Ireland only. The limit depends on whether the borrower falls within the Windsor Framework rules and on its sector.
Approved overdraft limit
The most the lender allows you to borrow. You only pay interest on what you use. GGS overdrafts start at £25,001.
Existing GGS and RLS borrowing
GGS or Recovery Loan Scheme borrowing your business group already has. It counts towards the limit, so only the headroom is left.
Amount drawn at the start
Your overdrawn balance on the start date. It cannot be more than the limit.
Interest rate (yearly)
The yearly rate on the amount drawn. Lenders set it, so use the rate from your quote.
Start date and end date
Interest is charged each day from the start date up to, but not including, the end date. The period can be up to a year.
Changes during the period
Choose how many times the balance changes after the start date, up to five. For each change, enter its date and an amount: positive if you draw more, negative if you pay money in.
Days in the lender's year
Most UK lenders use 365. Some use 360. Your agreement says which.
Arrangement fee
A one-off fee charged when the overdraft is set up.
Yearly facility fee
A fee charged each year to keep the overdraft. We charge the share for the days borrowed.
CALCULATOR QUESTIONS
GGS overdraft calculator questions
What is the Growth Guarantee Scheme?
A UK government-backed scheme where the government guarantees 70% of a business facility to the lender. The British Business Bank runs it.
Do I repay the guaranteed part?
Yes. The business is liable for the whole debt. The guarantee protects the lender, so it does not reduce what you owe.
Do I pay interest on the whole limit?
Usually not. Interest is charged on the balance you use, though a lender may charge fees on the limit.
Is the result a statement of what I will pay?
No. It uses one average balance, so it is an estimate. Your lender's daily balances set the real charge.
Who sets the interest rate?
The lender. Rates and fees vary, so compare offers from accredited lenders.
Does the calculator tell me if I'll be approved?
No. It shows how an amount sits against the published scheme limits. Accredited lenders decide whether to lend.
How do I apply?
Through an accredited lender. The British Business Bank website lists them and lets you filter by region and type of finance.