COVID-19: New Financial Support Tool & Further Business Help Announced
We’ve previously written about support available to help businesses though the Coronavirus pandemic.
There have been some further developments.
There’s a new business loan scheme as well as a handy tool to see what you could apply for.
Support Finder Tool
The government has published an online tool so you can see exactly what support your business could be eligible for.
It only takes about 60 seconds to answer the questions and it will immediately show you the support that could apply to your business.
You can find the tool here.
The Coronavirus Bounce Back Loan Scheme
What is it?
The scheme is designed to help small and medium-sized businesses. It will enable them to borrow between £2,000 and £50,000 over a term of up to 6 years.
Like the Coronavirus Business Interruption Loan Scheme (CBILS) – which we have mentioned in previous blogs – there are no fees or interest to pay in year 1.
However, where the CBILS has an 80% government guarantee, the Bounce Back scheme provides a 100% government guarantee. You also don’t need to make repayments in the first year.
What this means in practice is that lenders are more likely to lend under the new Bounce Back scheme compared to the CBILS.
Plus, the interest should be at a low level for the rest of the term after year 1, as the loans represent a lower risk to the lender.
Are you eligible?
If your business is UK-based, has been negatively affected by Coronavirus and was not an ‘undertaking in difficulty’ on the last day of 2019, it should be eligible.
What is yet to be confirmed is what you'll be able to borrow and how this is assessed, although it is likely to depend on your turnover.
Businesses not eligible include banks, insurers, reinsurers, public-sector bodies and state-funded primary and secondary schools.
You also won’t be eligible if you’re already claiming under CBILS, although it’s interesting to note that if your loan under CBILS is £50,000 or less, you can transfer it to the bounce back scheme (as long as done before November 4th 2020).
How do you apply?
The scheme will launch on 4th May 2020, and the government has said they will provide further details in due course.
If you need any further advice or guidance, please let us know. You can contact us here.