Bounce Back Loan Scheme for Small Businesses
On the 28th April 2020 Rishi Sunak, the chancellor, announced a new Bounce Back loan scheme, allowing businesses hit by the impact of coronavirus meassures to apply for up to £50,000, with the government guaranteeing 100% of the advance.
Billed by chancellor Rishi Sunak as a “simple, quick, easy solution for those in need of smaller loans,” businesses can apply from lenders using a two-page standard form with no forward-looking business viability tests or eligibility criteria.
According to an accompanying government press release, businesses can apply for a minimum of £2,000 up to a maximum of £50,000, or 25% of business turnover, with the government paying the interest for the first 12 months.
The scheme will open from 9am next Monday (4 May 2020), and according to the Chancellor most loans will be paid within 24 hours of approval. Businesses will be able to access the loans through the existing network of accredited lenders.
Speaking in the House of Commons, where he had earlier announced the microloan scheme, Sunak said the new scheme would help “bolster the existing package of support available to the smallest businesses affected by the coronavirus pandemic.”
Reacting to the announcement Michael Izza, ICAEW chief executive, said: “We’re very pleased to see the government is listening to concerns and continuing to refine its business support measures where problems arise. These new loans should help speed up the process of getting money to small businesses, which our members tell us has been an issue until now.
“However, we still believe that taking on debt is not going to be suitable for some, especially smaller businesses, and we would like to see greater use of grants as part of the overall support package.”
Britain's biggest banks are being ordered to agree to an industry-wide interest rate of less than 3% on loans handed out under the government's latest scheme to prevent the collapse of small businesses. An actual expected interest rate has been rumoured to be no more than 2.5%.
The Treasury is set to inform & dictate the lenders on Friday as to what that figure will be. This is only after the first 12 months has expired. Successful businesses will not be require to make any capital, interest or fee payments for the those first 12 months.
If you're a business and don't know where to start or what you might be eligible for please contact me - email@example.com
Or use the government's support finder : https://www.gov.uk/business-coronavirus-support-finder