Changes to state aid rules as a result of UK Government and industry lobbying mean that more small businesses can now benefit from loans of up to £5 million under the Coronavirus Business Interruption Loan Scheme (CBILS). Previously businesses which were classed as 'undertakings in difficulty' were unable to access CBILS because of EU rules. Businesses in this category and which have fewer than 50 employees and a turnover of less than £9 million can apply to CBILS.
Bounce Back Loan Scheme
The new Bounce Back Loans scheme, allows businesses to borrow between £2,000 and £50,000 and access the cash within days. Loans are interest free for the first 12 months and businesses can apply online through a short and simple form.
The Government, under the new scheme, will provide lenders with a 100% guarantee for the loan and pay any fees and interest for the first 12 months. No repayments will be due during the first 12 months.
The scheme launched for applications on Monday 4 May. Firms will be able to access these loans through a network of accredited lenders.
The new scheme runs alongside the existing Coronavirus Business Interruption Loan Scheme (CBILS) and Coronavirus Large Business Interruption Loan Scheme (CLBILS).
Initial £330 billion of government-backed loans announced (17 March) - for any business to access cash to pay rent, salaries, suppliers, purchase stock.
Separate schemes for small and medium sized businesses (Coronavirus Business Interruption Loan Scheme - CBILS), and for larger firms (Coronavirus Commercial Liquidity Fund - CCFF).
An additional scheme was announced (3 April) - the Coronavirus Large Business Interruption Loan Scheme (CLBILS).
Further details on each scheme are included below.
Coronavirus Business Interruption Loan Scheme - CBILS (through the British Business Bank)
This scheme is focused on small and medium sized businesses with a turnover of up to £45 million to access loans of up to £5 million. It is open for applications.
It will be interest free for 12 months.
Personal guarantees will not be taken for facilities below £250,000.
We understand that charities are eligible if they receive more than 50% of their income from trading.
Full guidance and details of how to apply can be found at https://www.gov.uk/guidance/apply-for-the-coronavirus-business-interruption-loan-scheme
Coronavirus Large Business Interruption Loan Scheme - CLBILS
This additional scheme was announced 3 April 2020 and is open to businesses with turnover of between £45 million and £500 million to access loans of up to £25 million.
The Government is taking additional steps on the Coronavirus Business Interruption Loan Scheme (CBILS) to ensure that lenders have the confidence they need to process finance applications quickly, including removing the per lender portfolio cap for the government guarantee, and changing the viability tests so that all banks will need to assess is whether a business was viable pre Covid-19.
Full guidance and details of how to apply can be found at https://www.gov.uk/guidance/apply-for-the-coronavirus-large-business-interruption-loan-scheme
Coronavirus Commercial Liquidity Fund - CCFF
New lending facility agreed with the Bank of England Governor.
Full rules of the scheme and guidance on how to apply are on the Bank of England's website at