Unfortunately you can not. I have looked into this in some detail for my clients and it clearly states in the rules governing this product you can NOT use it to repay existing loans with your bank.

I see where you are coming from as these 80% govt guaranteed loons will be priced between 2%-4% depending on your credit risk grade with your bank and obviously material cheaper than a standard overdraft or bank loan.

If you want any further information let me know as I have a small business pack on the govt guarantee loans.