The British Business Bank has committed up to £59m to a new private debt fund intended to increase access to growth finance for smaller companies across the UK and Ireland.
The investment forms the cornerstone of a £65.7m first close for BPC Europe SME DAC, the fourth fund in Beach Point Capital UK’s SME direct lending strategy.
The British Business Bank is supporting the fund alongside other investors, with the vehicle targeting established businesses seeking finance for expansion, acquisitions, investment, and job creation.
The fund will provide senior debt to companies with annual turnover below £25m. Individual loans are expected to range from £500,000 to £10m.
Beach Point Capital UK specialises in non-dilutive growth finance, meaning its lending arrangements do not ordinarily require business owners to surrender an equity stake in exchange for funding.
Instead, borrowers obtain debt financing subject to agreed interest payments, repayment obligations, and other contractual conditions.
The fund’s target borrowers include profitable companies and those on a clear path towards profitability, with established management teams and recurring or dependable revenue streams.
Such businesses may require capital for investment or acquisitions without wanting to change their ownership arrangements through an external equity funding round.
The Bank’s commitment of up to £59m represents a commitment to the investment fund. It does not mean that the full amount has already been advanced to individual businesses.
Similarly, the £65.7m first close establishes the initial investment capacity of the vehicle rather than a reported total of completed lending transactions.
The new commitment follows previous British Business Bank investments of £20m in 2022 and £30m in 2025 into Beach Point’s first dedicated UK SME lending fund.
Together with the latest commitment, the Bank’s potential financial exposure to Beach Point is expected to exceed £100m.
Beach Point’s predecessor UK SME fund has invested in 26 businesses across the UK’s nations and regions, with particular activity in Northern Ireland, Scotland, and the North of England.
Those earlier investments have supported companies seeking funding for business development, expansion, and operational investment.
The latest vehicle will maintain a broad sector mandate. Beach Point nevertheless expects to continue investing in businesses operating in technology, digital services, and financial services, where its earlier funds have developed experience.
Business Secretary Jonathan Reynolds said: “Small businesses are at the heart of our communities, creating jobs and driving growth.”
The government expects the additional lending capacity to support economic activity beyond the UK’s largest financial centres, including regions where the availability of specialist business finance can be more limited.
Adam Kelly, managing director and co-head of funds at the British Business Bank, said the partnership would make flexible growth finance available to smaller businesses seeking to expand their operations.
Private lending is one of several financing options available to established SMEs. Its suitability depends on a business’s capacity to service borrowing, the purpose of the investment, and the terms offered by lenders.
For businesses seeking acquisition finance or capital to expand their operations, longer-term lending arrangements can provide access to substantial funding while allowing existing owners to retain control.
Borrowers remain responsible for meeting the agreed repayment conditions, and finance providers must assess whether the business can support the additional debt.
The commitment also extends the British Business Bank’s use of specialist investment partners to deliver finance across different parts of the economy.
During the 2025/26 financial year, the Bank’s wider programmes supported access to £9.4bn of finance for smaller UK businesses, including public funding, private capital attracted through its activities, and lending supported by guarantees.
The new Beach Point fund adds another vehicle to that activity, with its lending capacity directed towards smaller companies meeting the fund’s commercial and financial criteria.
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