COVID 19 News and Updates – UK | | May 04, 2020
What we know
The Coronavirus Bounce Back Loan has been designed for small and medium-sized businesses enabling them to borrow between £2,000 and £50,000 (capped at 25% of turnover) with the Government taking on 100% of the risk. The scheme is part of the new emergency measures to help firms manage and cope with the Covid-19 crisis.
Key features of the loan scheme are discussed below.
The government will pay the interest charges and loan fees for the first 12 months. No repayments will be due during the first 12 months.
The loan term will be for up to 6 years. The government will work with lenders to agree a low rate of interest for the loan period remaining after the expiry of the first twelve month interest free period.
The scheme will open on 4 May and there will be “no forward – looking test of business viability, no complex eligibility criteria, just a simple, quick standard form for businesses to fill in”.
Officials have said that businesses can apply for the loan through their bank and will not be expected to offer any personal guarantees attached to the lending.
Businesses cannot apply if they have taken a loan under the Coronavirus Business Interruption Loan Scheme (CBILS). If, however the loan borrowed under CBILS is up to £50,000 and the Business would like to transfer it into the Bounce Back scheme then they can do so provided they arrange this with their lender by 4 November 2020.
You can apply for a loan if your business:
- Is based in the UK.
- Has been negatively affected by coronavirus.
- Was not an ‘undertaking in difficulty’ on 31 December 2019.
Who to contact
Your Business Relationship Manager at your Bank should be your first port of call as they will have a lot of the background information to hand.
The loan scheme will be available from Monday 4 May 2020.
Please see the Government Publication “Covid-19 Support for Business”