Following the Chancellor of the Exchequer’s announcement on 27 April, I’m writing to inform you that the Bounce Back Loan (BBL) Scheme opens for applications from today.
Delivered by lenders accredited by the British Business Bank for this scheme, Bounce Back Loans target small and micro businesses in all sectors, providing loans from £2k up to 25% of the business’ turnover with a maximum loan of £50k.
Providing lenders with a 100% government-backed guarantee and standardising the application form is expected to lead to a faster process with many loans becoming available within days.
The BBL page on our website is the best source of up to date information but for your ease of reference I am attaching the following documents which contain all the key details, including some social media assets (suggested post also noted below) you may wish to share to support awareness:
- Factsheet for SMEs. BBLS_Factsheet-04thMay2020 pdf.pdf
- Social media assets.
The Bounce Back Loans Scheme enables businesses to obtain a six-year term loan at a government set interest rate of 2.5% a year. The government will cover interest payable in the first year.
- Up to £50,000 loan: Loans will be from £2,000 up to 25% of a business’ turnover or £50,000, whichever is lower.
- 100% guarantee: The scheme provides the lender with a government-backed, full guarantee (100%) against the outstanding facility balance, both capital and interest. The borrower always remains 100% liable for the debt.
- Interest rate: The government has set the interest rate for this facility at 2.5% per annum, meaning businesses will all benefit from the same, low rate of interest.
- Interest paid by government for 12 months: The government will make a Business Interruption Payment to the lenders to cover the first 12 months of interest payable, so businesses will benefit from no upfront costs.
- No principal repayments for first 12 months: Borrowers will not have to begin principal repayments for the first 12 months, thereafter capital will be repaid on a straight line basis.
- No guarantee fee for businesses or lenders to access the scheme
- Finance terms: The length of the loan is for six years but early repayment is allowed, without early repayment fees.
- No personal guarantees: No personal guarantees are allowed, and no recovery action can be taken over a principal private residence or principal private vehicle.
For more information, contact one of the accredited lenders.
OTHER BUSINESS FINANCE SUPPORT OPTIONS
You can also find details of other government measures to support public services, people and businesses through this disruption on the Government’s Business Support website.