Rishi Sunak has launched a new fast-track “Business Bounce Back” loan scheme. The scheme will provide support to more than 5 million of Britain’s smallest firms.
The new scheme, which is expected to launch on Monday 4 May and will bolster the package of support already made available, will open to the small and medium-sized businesses and will provide loans amounting to up to 25 per cent of their turnover, capped at £50,000.
The announcement, which was made on Monday 27 April, comes amidst concerns that delivery of financial support to businesses in distress, under the schemes currently available (CBILS/CLBILS), has been sluggish.
The Government will guarantee 100% of the new loan. No fees or interest will be payable for the first 12 months.
Furthermore, loan terms will be up to 6 years and no repayments will be due during the first year.
A network of accredited lenders will ultimately be responsible for delivering the scheme. The Government will work with lenders to agree a low rate of interest for the remaining period of the loan.
Applying for the Business Bounce Back Loan Scheme
The loans will be easy to apply for via a short, standardised online application. Once approved, the funding should reach businesses within a matter of days.
Consequently, vulnerable businesses affected by Coronavirus should quickly receive the vital cash injections they desperately need to continue to operate.
At time of writing, the Government has confirmed that you can apply for a loan if your business is:
- based in the UK;
- has been negatively affected by the Coronavirus outbreak, and
- was not an ‘undertaking in difficulty’ at 31 December 2019.
The following businesses are ineligible:
- insurers and reinsurers;
- public-sector bodies;
- grant-funded further education establishments;
- state-funded primary and secondary schools, and
- businesses that have already successfully claimed under the Coronavirus Business Interruption Loan Scheme (CBILS).
However, those businesses who have already received a loan of up to £50,000 under the CBILS and who would like to transfer it into the Business Bounce Back Loan scheme, can arrange to do so with lenders, until 4 November 2020.
How can George Hay help?
We know that the coming weeks and months are going to be challenging for many businesses and employers. Though we have adapted some of our working practices in response to the outbreak, we are still contactable and urge you to keep communicating with us during this period of uncertainty.
Information is correct at time of writing (22/04/2020). Please keep an eye on our dedicated Coronavirus page, for the very latest news as we endeavour to cover the key issues affecting you and your business at this time. More information and advice is available on the Gov.uk website.