guarantors’ principal residences in support of personal guarantees. Pledging of business assets Applicants should be asked to pledge premises, machinery and other assets used in the business as security for the EFG loan, usually in the form of a fixed or floating charge. Where the assets to be pledged include property with any element of residential use (e.g. shop with flat above) consideration must be given as to whether or not the borrowing will be MCOB regulated. If the borrowing would be MCOB regulated, these assets must be pledged to secure conventional facilities only as it is not possible for EFG loans to be MCOB regulated. Guarantee Premium A guarantee premium is payable to the Government to the value of 2% per annum on the reducing balance of the loan. Premiums will be reduced to 1.5% (i.e. a 25% discount) will be applied to premiums due and collected in 2009. This will be managed centrally by the Government’s collection agents; there is no requirement for the Bank to amend premium schedules. All premiums are paid quarterly by Direct Debit. It is essential that the direct debit in respect of the BIS premium be paid as it falls due for payment. List of Eligible Lenders The following main lenders will lend to eligible businesses under Enterprise Finance Guarantee: Airdrie Savings Bank Alliance and Leicester Commercial Bank Bank of Baroda Bank of Ireland (Northern Ireland) Bank of Scotland Barclays Business Enterprise Fund Business Finance Solutions Clydesdale/Yorkshire Bank Compass Business Finance The Co-operative Bank DSL Business Finance Finance For Enterprise GLE oneLondon HSBC HBOS Lloyds TSB Metro Bank NEL Fund Managers Northern Bank (Northern Ireland) RBS/Natwest Santander Skipton Business Finance State Securities South West Investment Group Triodos Bank UK Steel Enterprises Ulster Bank (Northern Ireland) Whiteaway Laidlaw Bank Venture Finance Yorkshire Bank Comparison with its predecessor, The Small Firms Loan Guarantee Scheme, SFLG The objectives of SFLG are summarised in the 2004 Graham Report, which carried out a wide-ranging review of the scheme: "The aim of SFLG is to assist viable, debt-appropriate businesses that lack sufficient collateral to access loan finance in the market. In line with other interventions, SFLG should be used only in circumstances of market failure, where a viable business is unable to raise finance under conventional terms. SFLG forms part of the Government’s portfolio of interventions in the debt and equity markets, and, as such, it is designed to