Loan scheme now open

March 23, 2020
|In Business Strategy, General Business News
|By Andy Middler

 

The new Coronavirus Business Interruption Loan Scheme is open from today, Monday 23rd March 2020.

The scheme supports SMEs with access to working capital (including loans, overdrafts, invoice finance and asset finance) of up to £5 million in value and for up to 6 years.

The government will pay to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will not face any upfront costs and will benefit from lower initial repayments.

The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs.

This scheme is being delivered through commercial lenders, backed by the British Business Bank.

Eligibility

You are eligible for the scheme if:

  • your business is UK based, with turnover of no more than £45 million per year
  • your business meets the other British Business Bank eligibility criteria:
    • Have a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable the business to trade out of any short-to-medium term difficulty.

How to access the scheme

The scheme is now open for applications. To apply, you should talk to your bank or one of the 40 accredited finance providers (not the British Business Bank) as soon as possible, to discuss your business plan. You can find out the latest on the best ways to contact them via their websites.

All major banks are offering this scheme. If you have an existing loan with monthly repayments you may want to ask for a repayment holiday to help with cash flow.

The full rules of the scheme and the list of accredited lenders are available on the British Business Bank website.

 

PLEASE NOTE: This is not a grant. The borrower always remains 100% liable for the debt.

ALSO NOTE: If the lender can offer finance on normal commercial terms without the need to make use of the scheme, they will do so.

 

How we can help

As the criteria requires a proposal that would normally be viable, you will likely need up to date management accounts in order to apply. Speak to your account manager for further details.

 

All the best

The Middlers Team