We have produced this guide to provide you with an overview of these measures. Information is still being released and we will update our information for members as soon as it becomes available. Last update: 7th January 2020
At a glance: What has changed?
What is the Bounce Back loans scheme?
Bounce Back loans are loans of between £2000 and £50,000 capped at 25% of turnover.
If you get one of these loans you will not have to make any repayments for the first 12 months and the government will cover your first year’s interest payments.
You can choose to repay your loan over 10 years instead of 6 by extending it.
You also have the option to:
The government is calling these measures “pay as you grow”.
Note that you can only apply for one of the CBIL and the Bounce Back loan.
At a glance: What has changed?
What is Coronavirus Business Interruption Loans Scheme?
The CBILS is a scheme for small to medium businesses that allows you to borrow up to £5million.
The government offers an 80% guarantee to the lender which should give lenders the confidence to lend to SMEs. It is for UK based businesses with a turnover of under £45 million.
If you get one of these loans you will not have to make any repayments for the first 12 months and the government will cover your first year’s interest payments.
You will need to show that you have a business that would have been viable if not for the pandemic and has been adversely affected by the pandemic.
If you want to borrow £30,000 or more, you will need to show that your business wasn’t classed as a “business in difficulty” on the 31st December 2019.
The government has allowed lenders to extend the terms of a loan for up to 10 years.
Most SMEs (small or medium enterprises) are eligible except for banks, insurers, reinsurers, public sector bodies, or state funded primary and secondary schools.
You can apply for these loans from a participating lender- and can find out more here.
What is the difference between Bounce Back Loans and CBILs?
You can only apply for one of the Bounce Back Loan and the CBILS.
The differences include:
You can convert CBILS of less than £50,000 into a Bounce Back loan.
What is the Coronavirus Large Business Interruption Loans Scheme (CLBILS)?
This is a loan for businesses with turnover about £45 million. You can find out more about it here.
What is the coronavirus Future Fund?
This is a fund for UK businesses that have matched funding from private investors. You can find out more about it here.
Cash grants: Local Restrictions Support Grants
On the 5th January 2020 the government announced that businesses that have been required to close due to national restrictions could be eligible for a one-off grant of up to £9000. This is in addition to the grants announced last year.
On the 9th October the Government also announced, in England only a cash grant that will never have to repaid, for businesses forced to close by lockdown restrictions. On the 24th October, further grants were announced for businesses which are not legally closed but are affected by the restrictions. These grants will be administered by local authorities.
For businesses that are forced to close due to lockdown:
£1.3 billion funding has been granted to the Scottish, Welsh and Northern Ireland administrations, which may choose to implement a similar policy.
For businesses that were affected by local restrictions between 1st August and 5th November.
Grants of up to £2,100 a month have been made available, primarily for businesses in hospitality, accommodation and leisure, which may be adversely affected by the restrictions in high alert level areas (tier 2 or 3). These grants will be administered by local authorities, who will receive funding based on the rateable value of the businesses in their areas.
This is just a guide, because local authorities will determine exactly what funding each business gets.