New loan scheme to help small businesses 'bounce back' from the pandemic
Small to medium-sized businesses - including many letting agencies - will be eligible to borrow between £2,000 to £50,000 under the government's Bounce Back Loan scheme.
The government has launched a new loan scheme to help small and medium-sized businesses, including eligible letting agencies, access finance faster during the coronavirus outbreak.
The Bounce Back Loan scheme lets businesses borrow between £2,000 and £50,000. Once the loan is approved, businesses will receive the money "within days". The government guarantees 100% of the six-year loan, and there won’t be any fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year.
"Small businesses will play a key role creating jobs and securing economic growth as we recover from the Coronavirus pandemic," says Chancellor of the Exchequer, Rishi Sunak. "The Bounce Back Loan scheme will make sure they get the finance they need - helping them bounce back and protect jobs."
You can apply for a loan if your business is based in the UK, was established before 1 March 2020, and has been adversely impacted by the coronavirus.
If your business was classed as a business in difficulty on 31 December 2019, you’ll need to confirm that you’re complying with additional state aid restrictions.
You cannot apply if you’re already claiming funding under the Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS), or COVID-19 Corporate Financing Facility. However, you can transfer your loan to the Bounce Back Loan scheme if you’ve already received a loan of up to £50,000 under one of these schemes. You have until 4 November 2020 to arrange this with your lender.
How to apply
Eleven lenders are participating in the scheme, including many of the main retail banks, which you can find via the British Business Bank. You’ll need to approach lenders yourself via the lender's website. You’ll need to fill in a short online application form and self-declare that you are eligible for the loan. If approved, you will receive the money “within days”.
This article is intended as a guide only and is based on the government’s guidance on applying for a coronavirus Bounce Back Loan. Please visit gov.uk or the British Business Bank for more information.