February 2022

The most common reason why a director will be required to provide a personal guarantee is because a lender or supplier perceives a level of risk in your business. Perhaps the lender is not confident that your business cash flow is liquid enough to fulfil its obligations. Maybe they feel that, while your business is financially secure, your sector or industry is too volatile, and they need further protection. Perhaps your business has had a history of late payments, defaults, or liquidity issues in the past.