The government has launched a new Bounce Back loan scheme. This complements the Coronavirus Business Interruption Loan Scheme (CBILS) and is aimed at small businesses with turnover of under £500k.
The scheme opened on Monday 4th May and has the following key features:
- Between £2,000 and £50,000 can be borrowed (although the scheme is capped at 25% of turnover)
- Funds are accessible within days
- Loans will be interest free for the first 12 months
- No loan repayments are required in the first 12 months
- The interest rate is capped at 2.5% making it extremely cheap borrowing
- Loan terms are up to 6 years
- Neither forecasts nor business plans will be required (the application consists of a 2 page application form)
- No personal guarantees are required as the loans are 100% backed by the government
There are some eligibility criteria for loans:
- Your business must have been trading as of 1st March 2020
- You must not be in receipt of a CBILS loan
- Your business must have been negatively impacted by Coronavirus
Businesses can also check their eligibility for the government’s various support measures by accessing the online business support finder tool.