The terms of the CBILS loans for smaller businesses, which are available from around 40 lenders in the UK, are up to £5m and 6 years repayment with the Government guaranteeing 80% of each loan and covering the first years’ interest payments plus any lender fees. This Government backing will give confidence to lenders which is much needed at this time in order to invest in businesses in need, but also benefits the loan recipient with lower initial repayments.

 

Something to be reminded of before hastily applying however, is that unlike the grant funding of the Small Business Grant and Job Retention Schemes, these loans are exactly that – loans which are repayable, and the business has to ensure they will be able to cover full repayment over the loan term. This is the reason that applicants have been asked to provide a viable borrowing proposal in order to show their plans. The last thing you would want after the current stress is to be in a position where your future liquidity is questionable and you end up in arrears on a large loan.

 

Having said this, as long as you have your eyes open to the risks (which is the case when taking out any loan) then a beneficial loan like this could be a good option to keep the cash flowing until things pick up again.

 

 

There is also assistance available to larger businesses, whose annual turnover is over the £45m threshold. They can get support by way of the Coronavirus/COVID-19 Corporate Financing Facility (CCFF) in which the Bank of England steps in and helps with financing short-term debts (such as invoice factoring).

 

If you are looking for a list of loan providers for the CBILS, then please visit https://tinyurl.com/Brbnkc19