The firm continued that around £10m of the funding was set aside to support UK businesses affected by changes in international trade tariffs, especially in sectors like manufacturing that are particularly impacted.
Paragon Bank said that the latest allocation would strengthen its ability to offer “vital funding” to thousands of SME customers in the UK.
The company said that it had delivered around £40m in Growth Guarantee Scheme-backed funding to over 300 companies.
The funding will allow it to “extend its reach further”, and it will offer unsecured loans and asset-based finance to firms that would “otherwise struggle to access capital”.
The Growth Guarantee Scheme is the successor to the Recovery Loan Scheme and aims to support access to finance for smaller businesses.
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The scheme can generally support facility sizes of up to £2m and provides the lender with a 70% government-backed guarantee.
Earlier this year, the Chancellor said that the scheme would provide £500m of additional lending capacity to help smaller businesses across the UK.
Phil Hughes, deputy managing director of SME lending at Paragon Bank, said: “The additional funding from the British Business Bank is a welcome boost and a clear vote of confidence in our ability to deliver meaningful support to UK SMEs.
“The dedicated £10m for businesses impacted by international trade disruption is particularly important – these firms have faced unique pressures and we’re proud to be in a position to help them adapt and thrive.
“We’ve already seen the transformative impact of the Growth Guarantee Scheme, and with this new allocation, we’re ready to support even more businesses on their growth journeys.”
Reinald de Monchy, chief banking officer at British Business Bank, said: “We are pleased to provide this additional capacity to Paragon Bank from the Growth Guarantee Scheme. Manufacturing is an important sector for the scheme, and we look forward to seeing the impact Paragon will have on their customers from this lending, unlocking much-needed capital for smaller businesses across the sector and generating growth.”