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It remains to be seen how easy it is to access this particular scheme, given the difficulties businesses have faced to date accessing the Coronavirus Business Interruption Loan Scheme, but it does appear that the government have done all they can to make it easier for small businesses to access finance to help them through these uncertain times.
Below is an outline of the information we know to date. More is likely to follow in the next week, and we will provide an update when we have more details:
The scheme is available for small and medium sized businesses to borrow between £2,000 and £50,000.
100% of the loan will be guaranteed by the government, rather than 80% for the Coronavirus Business Interruption Loan Scheme (CBILS), and as per the CBILS there will be no fees or interest applicable for the first 12 months.
Repayment terms will be for up to 6 years and no repayments will be due during the first 12 months.
Whilst minimal information is available about the application process itself, the understanding is that it will be more straight forward than the CBILS, with less hoops to jump through, and the business should only need to prove its financial viability prior to, rather than after the end of the coronavirus pandemic.
Any UK based company who has been adversely affected by coronavirus, and was not “undertaking in difficulty” on 31 December 2019 is eligible to apply for a loan under this scheme, but as per the CBILS, public sector bodies, banks and insurers, and establishments of education, such as schools and grant funded universities are not eligible to apply.
If you have already made a successful application for the CBILS and the amount borrowed is less than £50,000, you should be able to arrange with your lender to transfer it to the Bounce Back Scheme until 4 November 2020.
Link to the gov.uk site: https://www.gov.uk/guidance/apply-for-a-coronavirus-bounce-back-loan
