Bounce Back Loan Scheme

Bounce Back Loan Scheme (BBLS) opens

Monday 4th May 2020

 

WARNING! we’ve been advised by a firm of liquidators that any company directors who have taken out the loan and whose business then ceases to trade in the first year especially, will be investigated by the revenue. The money is not expected to be used to clear existing business loans, it is intended to be working capital. Make of that what you will.

The government have announced that they will personally prosecute any directors of businesses who take the loan out and wind their company up in the first year

 

UPDATE – GOOD NEWS! THIS SCHEME IS WORKING FOR THE MAJORITY OF BANKS AND THE MONEY IS ARRIVING IN BANK ACCOUNTS SWIFTLY

 

Key facts

  • Is helping small businesses by lending up to 25% of annual turnover, interest free for a year
  • To a maximum loan value of £50,000 with a lower limit of £2,000
  • 100% backed by the government to the lender
  • There are no personal guarantees required
  • Repayment can be at any time, the government are paying any fees
  • Is a simple and quick stop gap for companies who need additional funding
  • Your business must be negatively impacted by the Coronavirus outbreak
  • The loan is for six years (but can be repaid sooner)
  • After the first year (where the government pays the interest) the rate will be 2.5%

 

Procedure

  • You are advised to go to your own business bank first
  • If they turn you down you are encouraged to approach a different bank
  • There will be a short application form to complete via the website of the lender you approach
  • If you are in the process of applying for a CBILS loan you can ask to switch (CBILS has now changed its lower limit to £51,000 to avoid duplication and confusion

 

Who is not eligible?

  • If you business was a ‘business in difficulty’ on December 31st 2019 you may not be eligible
  • State owned schools, insurance companies, credit institutions or public sector organisations
  • A business undergoing bankruptcy proceedings
  • A business where less that half it’s income if from trading activity
  • You are already in possession of the CBILS loan (but you can see if you can switch if your CBILS loan was for £50,000)

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If you have a question about the scheme there’s a FAQ section here

 

Here’s the link to see who is offering the loan if you are not able to get it through your existing bank