Loan Facilities | Glasgow Chamber of Commerce

Loan Facilities

Flexibility to pay back loans 

Businesses who took out a Bounce Back Loan through a new Pay as You Grow flexible repayment system. This will provide flexibility for firms repaying a Bounce Back Loan.

This includes extending the length of the loan from six years to ten, which will cut monthly repayments by nearly half. Interest-only periods of up to six months and payment holidays will also be available to businesses.

Also intend to give Coronavirus Business Interruption Loan Scheme lenders the ability to extend the length of loans from a maximum of six years to ten years if it will help businesses to repay the loan.

In addition, the Chancellor also announced he would be extending applications for the government’s coronavirus loan schemes that are helping over a million businesses until the end of November. As a result, more businesses will now be able to benefit from the Coronavirus Business Interruption Loan Scheme, the Coronavirus Large Business Interruption Loan Scheme, the Bounce Back Loan Scheme and the Future Fund.

Bounce Back Loans for small businesses  Apply here [LIVE]

The UK Government announced (27 April) a new fast-track finance scheme providing loans with a 100% government-backed guarantee for lenders.  Businesses are able to borrow between £2,000 and £50,000 and access the cash within days.  The loans will be interest free for the first 12 months, and businesses can apply online through a short and simple form. .

Future fund - £500 million investment fund for high-growth companies  Apply here [LIVE]

Announced by the UK Government on 20 April, the £500 million Future Fund has been designed to ensure high-growth companies across the UK receive the investment they need to continue during the crisis.

Delivered in partnership with the British Business Bank, the fund will provide UK-based companies with between £125,000 and £5 million from the government, with private investors at least matching the government commitment. These loans will automatically convert into equity on the company’s next qualifying funding round, or at the end of the loan if they are not repaid. To be eligible, a business must be an unlisted UK registered company that has previously raised at least £250,000 in equity investment from third party investors in the last five years.

The government is committing an initial £250 million in funding towards the scheme, which will initially be open until the end of September. The scale of the fund will be kept under review.

£750 million support for SMEs focusing on research and development  Apply here [LIVE]

Announced by the UK Government on 20 April, the £750m package is to provide targeted support for the most R&D intensive small and medium size firms and will be available through Innovate UK’s grants and loan scheme.  Innovate UK, the national innovation agency, will accelerate up to £200 million of grant and loan payments for its 2,500 existing Innovate UK customers on an opt-in basis. An extra £550 million will also be made available to increase support for existing customers and £175,000 of support will be offered to around 1,200 firms not currently in receipt of Innovate UK funding. The first payments will be made by mid-May.

British Business Bank Business Interruption Loan Scheme [LIVE]

To access the scheme approach you bank directly as the administrator.  List of eligible banks here 

The temporary Coronavirus Business Interruption Loan Scheme will support SMEs with access to loans, overdrafts, invoice finance and asset finance of up to £5 million and for up to 6 years.  The government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments. The government will provide lenders with a guarantee of 80% on each loan (subject to pre-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs. The scheme will be delivered through commercial lenders, backed by the government-owned British Business Bank.  

Eligible for the scheme if:

  • your business is UK based, with turnover of no more than £45 million per year
  • your business meets the other British Business Bank eligibility criteria 

Security

  • Insufficient security is no longer a condition to access the scheme.
  • For all facilities, including those over £250,000, CBILS can now support lending to smaller businesses even where a lender considers there to be sufficient security, making more smaller businesses eligible to receive the Business Interruption Payment.
  • No personal guarantees for facilities under £250,000.
  • Personal guarantees may still be required, at a lender’s discretion, for facilities above £250,000, but they exclude the Principal Private Residence (PPR) and recoveries under these are capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied.

Coronavirus Large Business Interruption Loan Scheme (CLBILS) 

The scheme will ensure that more firms are able to benefit from government-backed support during this difficult time. It will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £250 million and loans of up to £50 million for firms with turnover of more than £250 million. This will give banks the confidence to lend to more businesses which are impacted by coronavirus but which they would not lend to without CLBILS. Loans backed by a guarantee under CLBILS will be offered at commercial rates of interest. 

To access the scheme approach you bank directly as the administrator.  List of eligible banks here 

COVID-19 Corporate Financing Facility (CCFF) 

Under the new Covid-19 Corporate Financing Facility, the Bank of England will buy short term debt from larger companies. This will support your company if it has been affected by a short-term funding squeeze and allow you to finance your short-term liabilities. It will also support corporate finance markets overall and ease the supply of credit to all firms.

Eligibility Criteria

 Further Information and Resources

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