Coronavirus Business Interruption Loan Scheme
In December 2020, the Chancellor, Rishi Sunak announced that the deadline for applications to the Coronavirus Business Interruption Loan Scheme (CBILS) will now close to new applicants on 31 March 2021, extended from 31 January.
The CBILS provides financial support to smaller businesses (SMEs) across the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak and is part of a wider package of government support for UK businesses and employees.
There are over 100 lenders currently working to provide finance, including:
- high-street banks
- challenger banks
- asset-based lenders
- smaller specialist local lenders
A lender can provide up to £5 million in the form of:
- term loans
- overdrafts
- invoice finance
- asset finance
CBILS gives the lender a government-backed guarantee for the loan repayments to encourage more lending.
Bounce Back Loan Scheme
The Bounce Back Loan Scheme (BBLS) was introduced to enable smaller businesses to access finance more quickly during the coronavirus outbreak.
It helps small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover. The maximum loan available is £50,000.
The government guarantees 100% of the loan and there are no fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year and the term of the loan can be up to 10 years.
To apply for a loan, the business must be:
- based in the UK
- established before 1 March 2020
- adversely impacted by coronavirus
The BBLS is also open to applications until 31 March 2021.
If you already have a BBL but borrowed less than you were entitled to, you can top up your existing loan to your maximum amount. You must request the top-up by 31 March 2021.
Get in touch
It is welcome news that the deadline for applications to both schemes is now 31 March 2021.
We have helped a number of businesses to access government backed products from a range of lenders since the schemes were introduced. If you need our help with a funding application, get in touch.
Disclaimer
The information was correct at time of publishing but may now be out of date.
