British Business Bank will offer up to £1bn in guarantees to banks that lend to small-business builders.
Provided by the Ministry of Housing, Communities and Local Government, the ENABLE Build programme hopes to contribute to the Government’s target of delivering 300,000 homes a year by the mid-2020s.
The British Business Bank has so far committed guarantees of over £800m under its ENABLE Guarantee programme.
The programme is designed to encourage additional lending to smaller housebuilders by reducing the amount of capital required to be held by banks, meaning the Government takes on a portion of the risk instead of the small business.
The scheme only accepts applications from lenders where at least 80 per cent of the loans are to developments in England. Housing policy in Scotland, Wales and Northern Ireland is devolved.