New Bounceback Loans Announced
The Chancellor announced yesterday a new scheme which will help small and medium-sized businesses affected by the coronavirus (COVID-19) to apply for loans of up to £50,000.
This is in addition to the Coronavirus Business interruption loan scheme ( CBILS) we advised of previously.
There will be no forward-looking tests of business viability; no complex eligibility criteria which we have seen holding up or drawing out applications for loans under the CBILS loan scheme.
There will just a simple, quick, standard form for businesses to fill in; For most firms, loans should arrive within 24 hours of approval.
Launch date
The scheme is not available yet. It will launch on 4th May 2020.
What is available
- The Bounce Back Loan scheme will help small and medium-sized businesses to borrow between £2,000 and £50,000.
- Businesses will be able to apply for these new Bounce Back Loans for 25% of their turnover, up to a maximum of £50,000, with the government paying the interest for the first twelve months.
- The government will guarantee 100% of the loan and there won’t be any fees or interest to pay for the first 12 months.
- Loan terms will be up to 6 years. No repayments will be due during the first 12 months. The government will work with lenders to agree on a low rate of interest for the remaining period of the loan.
- The scheme will be delivered through a network of accredited lenders.
Who is eligible
You can apply for a loan if your business:
- Is based in the UK
- Has been negatively affected by the coronavirus
- Was not an ‘undertaking in difficulty’ on 31 December 2019
If you’re already claiming funding
- You cannot apply if you’re already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS).
- If you’ve already received a loan of up to £50,000 under CBILS and would like to transfer it into the Bounce Back Loan scheme, you can arrange this with your lender until 4 November 2020
Don’t hesitate to contact us if you wish to discuss the new bounceback loans, CBILS or other grant and funding options announced by the government as a result of COVID-19.
For more information on COVID-19 or financial support, get in touch here. Otherwise stay up-to-date with all the latest COVID-19 announcements, here.
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