Recovery Loan Scheme
Posted on 10th May 2021 at 18:37
A new government backed loan scheme was launched on the 6th April to provide additional finance to those businesses in need, as they grow and recover from the disruption of the COVID-19 pandemic. The scheme is to ensure that businesses continue to benefit from government guaranteed finance throughout 2021 and is open until 31st December (which is subject to review).
Recovery Loan Scheme Summary
To help businesses of any size access loans and other types of finance, with loans being made available up to £10 million, the term and the amount offered will be at the discretion of the lender. The government is to guarantee 80% of the finance to the lender. Loans are available through a network of accredited lenders, as listed on the British Business Bank website, which can be accessed by clicking HERE.
Terms
• A loan or overdraft of between £25,001 and £10 million (per business)
• Invoice or asset finance of between £1,000 and £10 million (per business)
* There is to be no personal guarantees taken on borrowing facilities up to £250,000, and the borrower’s principal private residence is not to be taken as security.
The length of the borrowing facility will depend on the type of finance applied for, but will be up to:
• Three years for overdrafts and invoice finance facilities
• Six years for loans and asset finance facilities
Eligibility
Businesses from any sector can apply and will need to be trading in the UK and must demonstrate that the business:
• Would have been viable if it were not due to the COVID-19 pandemic
• Has been adversely impacted by the COVID-19 pandemic
• Is not in collective insolvency proceedings (unless your business is in scope of the Northern Ireland Protocol whereby there are different eligible terms)
Non eligible sectors include:
• Banks, Building Societies, Insurers and Reinsurers (but not Insurance Brokers)
• Public-sector bodies
• State-funded primary and secondary schools
NOTE - Businesses that have already received financial support under the pre COVID-19 guaranteed loan schemes will still be eligible to access the finance under this scheme, as long as the eligible criteria is met..
Full scheme details and how to apply can be found by clicking HERE.
Disclaimer:
Whilst every effort in ensuring the accuracy of the content of these notes has been considered, we cannot be held responsible in any way in regards to any consequences and/or decisions arising from the information provided. For specialist advice tailored to your individual circumstances - please seek professional advice and contact us on the above details.
For more information about the Recovery Loan Scheme from one of our experienced and qualified team, please call 0121 550 8509 or email info@godfreymansell.co.uk.
Tagged as: Covid 19, Recovery Loan Scheme
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