Bounce Back Loan Scheme (BBLS)
Last updated 4 May 2020
Main Bounce Back Loan Scheme features
- 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.
Bounce Back Loan Scheme eligibility criteria
Businesses from all sectors can apply for a facility with few exceptions. The business must self-certify to its lender the following:
- Confirm it is UK-based in its business activity, and established by 1 March 2020
- Confirm it has been adversely impacted by the Coronavirus (COVID-19)
- Confirm it is not currently using a government-backed Coronavirus loan scheme (unless using BBLS to refinance a whole facility)
- Confirm it is not in bankruptcy, liquidation or undergoing debt restructuring
How to apply
- Businesses should check the British Business Bank website to find out which lenders provide Bounce Back Loans.
- Businesses will be required to fill in a short online application form on their lender’s website, which self-certifies whether they are eligible for a Bounce Back Loan facility. Eligible companies will be subject to standard customer fraud, Anti-Money Laundering (AML) and Know Your Customer (KYC) checks. Some State aid restrictions may apply to applications.
- A list of BBLS accredited lenders can be found on the British Business Bank website.
Read more on our Bounce Back Loan Scheme Q&A article here.
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