On April 27th Rishi Sunak announced the new Bounce Back Loan scheme. The Government has been under pressure to provide more support for small businesses, some of whom have been finding navigating the CBLIS loan system difficult. The application is likely to involve a simple two-page application (standardised across lenders) with no need to demonstrate affordability or to provide security.
The below summary includes the key points including eligibility criteria for the loans and time frames for acceptance.
You can apply for a Bounce Back Loan if your business:
- Is UK based
- has been negatively impacted by Covid-19
- was not an ‘undertaking in difficulty’ as of the end of 2019
Businesses that are not eligible to apply:
- public-sector bodies
- further-education establishments, if they are grant-funded
- insurers and reinsurers
- state-funded primary and secondary schools
- Loans of between £2,000 and £50,000
- Importantly the government will support lenders with a 100% guarantee for the loan
- Terms of up to 6 years
- There are no fees or interest to pay for the first 12 months
- No loan repayments will be due during the first 12 months
- There will be a “low level” of interest for the remaining period of the loan.
How to apply for a Bounce Back Loan
- Applications for the Bounce Back Loan scheme will launch on the May 4th
- As with the CBILS the scheme will be delivered through a network of accredited lenders.
- According to Rishi Sunak’s briefing “The loans will be easy to apply for through a short, standardised online application. The loan should reach businesses within days.”
For further information on the Bounce Back Loan scheme please see the relevant Government Web Page
We are constantly updating our guidance and this information was correct as of 28/04/2020. If you have any further questions please don’t hesitate to contact us