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Why choose HGH?

New Bounce Back Loan Scheme Launched

Posted: 28th Apr 2020 by Clair Watmore Business Advice General, Coronavirus, Corporate Finance

Rishi Sunak announced yesterday details for the new Bounce Back Loan Scheme. Small businesses will benefit from the new fast-track finance scheme, providing loans with a 100% government-backed guarantee for lenders. If you are a small business who struggled to get a CBILS loan then this could be for you.

The loans will be easy to apply for through a short, standardised online application. The loan should reach businesses within days – providing immediate support to those that need it as quickly as possible.

Finance available

  • Loans of between £2,000 and £50,000 / maximum of 25% of turnover
  • Loan terms will be up to 6 years
  • No fees or interest to pay for the first 12 months
  • No loan repayments will be due during the first 12 months
  • “….a low standardised level of interest for the remaining period of the loan”
  • The government will provide lenders with a 100% guarantee for the loan
  • No personal guarantees required

Eligibility

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
  • available to sole traders, partnerships, limited companies and LLP’s

The following businesses are not eligible to apply:

  • banks, insurers and reinsurers (but not insurance brokers
  • public-sector bodies
  • further-education establishments, if they are grant-funded
  • state-funded primary and secondary schools

Interaction with CBILS

You cannot apply if you’re already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS).

If you’ve already received a loan of up to £50,000 under CBILS and would like to transfer it into the Bounce Back Loan scheme, you can arrange this with your lender until 4 November 2020.

How do I apply?

The scheme will launch for applications on Monday 4 May. You will be able to access these loans through a network of accredited lenders.

The government are working with lenders to ensure loans delivered through this scheme are dealt with as quickly as possible and agree a low standardised level of interest for the remaining period of the loan.

More information about the scheme will be published shortly.