Bounce Back Loan Scheme (BBLS)
The Bounce Back Loan Scheme is a Government scheme that will provide loans of up to £50,000 to ensure that small firms that need vital cash injections to keep operating can obtain finance in a matter of days.
UK firms will now have until the end of March to apply for emergency business loans, including bounce back loans (BBLS). Bounce Back Loan Scheme rules now allow those businesses who have borrowed less than their maximum (i.e. less than 25% of their turnover) to top-up their existing loan.
The details announced to date are summarised below:
- Businesses can apply for loans between £2,000 and £50,000 but will be limited to loans not exceeding 25% of turnover.
- Access to cash, following a successful application, should be made available within days.
- Government will step in and repay the loan (100% guarantee) if the company is unable to meet its loan obligations.
- Loans will be interest-free for the first twelve months and Government will cover any other fees associated with the loan set-up.
- No loan repayments will be required for the first year.
- The Government will work with lenders to ensure loans delivered through this scheme are advanced as quickly as possible and will further agree a low standardised level of interest for the remaining period of the loan.
- You cannot apply if you’re already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS), though you could transfer CBILS funding to this new scheme.
- The maximum loan repayment term was six years.
Who can apply for this loan?
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
How to apply?
The full rules of the scheme and guidance on how to apply is available on the British Business Bank website. HERE
How it works?
BBLS is available through a range of British Business Bank accredited lenders and partners, listed HERE.
For more information visit HMRC’s BBLS dedicated page HERE
Under new ‘Pay as You Grow’ options for BBLS:
- New and existing borrowers will have the option to repay their loan over a period of up to ten years.
- UK businesses will also have the option to move temporarily to interest-only payments for periods of up to six months. This option can be used up to three times.
- Alternatively, businesses can pause their repayments entirely for up to six months, although this option is only available after six payments have been made and can be used just once.
We hope that you find this informative and useful.