Updated 18 May
Among the range of UK Government measures to help protect businesses and individuals from the economic impact of coronavirus (we have a complete list here), the latest to be announced is the Bounce Back Loan Scheme.
The scheme was launched on Monday 4 May. Key points are:
- You can borrow between £2,000 and £50,000, subject to borrowing no more than 25% of turnover
- The government guarantees the whole loan
- There are no fees or interest for the first 12 months. After that a rate of interest of 2.5% applies for the remaining period of the loan
- Loans can be for up to six years with no repayments for the first 12 months
- The scheme will be run through ‘a network of accredited lenders’, with 20 banks confirmed so far
- Early repayments are allowed without any early repayment fees
To be eligible for a Bounce Back Loan, the conditions are that your business:
- Is UK-based
- Has been negatively affected by the current situation
- Wasn’t an ‘undertaking in difficulty’ at 31 December 2019, which for businesses more than three years old means accumulated losses cannot exceed 50% of subscribed share capital. Businesses in difficulty may still be eligible subject to State Aid rules
- Isn’t already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS). If you’ve already received a loan of up to £50,000 under CBILS, you can arrange to transfer it to BBLS with your lender until 4 November 2020
Accredited lenders are administered by the British Business Bank, which has information about BBLS here.
Please check our website again for more details as they become available. For more information about the various coronavirus support schemes and how your business could benefit from them, please get in touch with your usual BKL contact or use our enquiry form.