- Written by Super User
On the 27th April the Government announced new support for small business. The ‘Bounce Back Loans’ should provide new fast track finance to small business.
Also called the Micro Loan Scheme, it provides small business with access to finance up to 50,000.
We have little detail of the scheme but we are aware of the following:
- The value of the loan will be 2,000 to 50,000
- The loan will be capped at 25% of the entity’s turnover
- The Government will pay the interest for 12 months
- No fees are payable on the arrangement of the facility
- Loan terms are no longer than 6 years
- No loan repayments are due for 12 months
- The interest after year one will based on a low standardised level of interest
- The Government will provide the lenders with a 100% guarantee on loan
You can claim for the loan if you have:
- Negatively been affected by the coronavirus
- The business is based in the UK
- You were not in financial difficulty on 31 December 2019
The following businesses are not eligible to apply:
- Public sector bodies
- Banks, insurers and reinsurers
- Grant funded further education establishments
- State funded primary and secondary schools
The ‘Bounce Back Loans” will be launched on 4 May at 9am.
The scheme will be delivered through a network of lenders.
The Government have stipulated that the process will be a short, standardised online application. It will not request detailed financial information and then be subject to a list of suitability checks from the lender.
The loan should be received by the business within 24 hours of the application being processed.
If you are already claiming under the Coronavirus Business Interruption Scheme you may be allowed to transfer the capped proportion of this over to the new scheme. You will have until 4 November 2020 to transfer it.
We will need to review the further guidance on this new loan when it is released. If you want to discuss this new loan process with us, contact the Spirare team.