Coronavirus Bounce Back Loan
The UK Government is continuing to provide daily updates and publications on their measures to deal with the disruption caused by COVID-19. Following pressure from businesses the UK Government has announced a Coronavirus Bounce Back Loan.
Coronavirus Bounce Back Loan
The UK Government has announced a new Coronavirus Bounce Back Loan in acknowledgement that obtaining a loan under the Coronavirus Business Interruption Loan Scheme (CBILS) is proving a lengthy and overly burdensome process. The new Coronavirus Bounce Back Loan has been designed to help small and medium sized businesses borrow smaller amounts more easily.
A business can apply to borrow between £2,000 and £50,000 and the loan will be 100% guaranteed by the UK Government. Loan terms will be allowed up to 6 years with no interest, fees or repayments due for the first 12 months.
The application for borrowing under this scheme will be simpler than that under the Coronavirus Business Interruption Loan Scheme. There will be no requirement to provide proof of future earnings (such as via a cashflow forecast) and credit checks will only be performed for fraud and identify purposes. The application form will also be shorter and simpler than that of the Coronavirus Business Interruption Loan Scheme.
The Coronavirus Bounce Back Loan scheme will launch on 4 May 2020. Those businesses that have already obtained a loan under the Coronavirus Business Interruption Loan Scheme will not be able to use this scheme but may transfer their loan to this scheme if they have borrowed less than £50,000.
UK Government guidance on the Coronavirus Bounce Back Loan can be found here.
