Covid-19 : Business Support 04.05.20 – Update 28
Bounce Back Loan Scheme – open for applications
The Bounce Back Loan Scheme (“BBLS”) launched at the beginning of last week is now open for applications. The BBLS is available through a range of British Business Bank accredited lenders and partners, listed on the British Business Bank website here.
As previously advised the BBLS provides financial support to businesses across the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak and that can benefit from loans between £2,000 and £50,000, capped at to 25% of a business’ turnover. The government guarantees 100% of the loan and there are no fees or interest to pay for the first 12 months. Loan terms will be up to 6 years with no repayments due during the first 12 months.
On announcement of the BBLS the government advised that they will work with lenders to agree a low rate of interest for the remaining period of the loan. Subsequently over the weekend, in a letter to lenders, the Treasury confirmed that the BBLS would be excluded from stringent consumer protection laws in order to speed up the process of getting money to small businesses and that interest on BBLS is to be capped at 2.5%.
To make an application, businesses are advised to:
- Approach a lender, ideally via its website.
- In the first instance, businesses may wish to approach their existing provider. Businesses may also consider approaching other lenders if they are unable to access the finance required.
- Complete a short application form online, which self-certifies that your business is eligible for a loan under BBLS.
- If the business is eligible, it will be subject to appropriate customer fraud, Anti-Money Laundering (AML) and Know Your Customer (KYC) checks. Some state aid restrictions may apply in the application.
- Note that there is high demand for finance through BBLS so phone lines are likely to be busy and branches may not be able to handle enquiries in person.
BBLS is designed to be fast for lenders to process and quick and easy for businesses to access.