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49% year-on-year rise in small businesses seeking protection from personal guarantees

April 2024: As the Federation of Small Businesses (FSB) calls for a more comprehensive investigation into the use of personal guarantees for small business loans, the number of small business owners becoming personal guarantors continues to rise.  According to new analysis of applications for personal guarantee insurance in Q1 2024, by Purbeck Personal Guarantee Insurance, the UK’s sole provider of insurance protection for personal guarantees, there has been a 49% rise in business owners seeking Personal Guarantee Insurance (PGI) for a small business loan. And most of these were for loans to simply keep their business running.

Analysis suggests just 11% of small business loans go to female founders

  • Companies founded solely by women garnered just 1.8% of the total capital invested in venture-backed startups in Europe.  
  • The total value of loans supported by Personal Guarantee Insurance (PGI) was over £379m in 2023, but just 5% of that value was for female founders.
  • 11% of people taking PGI for a business loan have been women, a small rise on 2022 which saw just 9% of policies taken by women for personal guarantee backed loans.
  • The total value of loans supported by PGI amounted to over £379m in 2023, but just 5% of that value was for female founders, equating to £20m.

 

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