Earlier this week Rishi Sunak announced that the government will be introducing Bounce Back Loans for small businesses.
Designed to help those who are struggling to stay afloat amid the COVID-19 outbreak, companies will be able to borrow up to £50,000 and will receive the funds within days. What’s more, the loans come with a 100% government-backed guarantee for lenders.
Who’s eligible to apply for a loan?
You can apply for the Bounce Back Loan scheme if your business is based in the UK, has been negatively affected by Coronavirus and was not an ‘undertaking in difficulty’ on or before 31 December 2019.
The following businesses are not eligible to apply:
- Banks, insurers and reinsurers (except insurance brokers)
- Public sector bodies
- Further education establishments if they’re grant-funded
- State-funded primary and secondary schools
- Those who are already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS)
If you’ve already received a loan of up to £50,000 under the CBILS and would like to transfer it to the Bounce Back Loan scheme, you can arrange this with your lender up until 4 November 2020.
How much can I borrow?
You can borrow between £2,000 and £50,000 and will be able to access the cash within days.
When do I have to pay the money back?
No repayments will be due in the first 12 months while UK businesses try to get back on their feet. Loans must however be paid back within six years.
What about interest?
Bounce Back Loans will be interest free for the first 12 months. The government and lenders will agree a low standardised level of interest for the remaining period of the loan.
How and when do I apply?
Applications open on Monday 4 May 2020 and you can apply online through a short and simple form. No link is available at the moment, but we will continue to update you as soon as we receive further information.
The government is working with lenders to ensure that loans are advanced as quickly as possible so you can be rest assured that should you need it, financial support is on its way.
If you would like help managing any aspect of your finances during the Coronavirus outbreak, please don’t hesitate to get in touch and we’ll be more than happy to help.
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