Businesses can apply for a loan of up to £5m, which can be used for recovery, growth, or security.
The Coronavirus Business Interruption Loan Scheme (CBILS) has been extended, the initiative is now open for applications until 31st March 2021. The scheme is part of a support package for businesses that has seen more than £200bn injected into the UK’s economy to date.
The latest extension follows a raft of new proposals put forward to support the economy during the pandemic.
Previously, companies had to apply to accredited lenders by the 31st January 2021, with providers given until 31st March to supply the funding. Firms must now register their interest in a loan by 31st March, and lenders must make an offer to successful applicants by 31st May.
All of the loan schemes; CBILS, the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Bounce Back Loan Scheme (BBLS) – have been extended. In all cases, the government’s guarantee covers 80% of each loan for ten years.
The Success Rate So Far
The CBILS and CLBILS schemes were launched in March 2020, shortly after the coronavirus pandemic began, with the aim of helping companies that have suffered disruption to their cash flow as a result of Covid-19. The government guarantees 80% of each loan and pays all of the fees and interest for the first 12 months.
Recent statistics on CBILS, covering the period to 13th December, show that the approval rate for loans is 44%. Around 82,500 of just under 186,500 applications have been approved, with lenders providing £19.64bn in funding to UK SMEs.
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) has a higher approval rate (63%), although the pool of applicants is much smaller at just 1,077 application.
More than £43.5bn has been provided under the Bounce Back Loan Scheme (BBLS), providing loans of up to £50,000 backed 100% by the government, “no questions asked”, it has a success rate of 75%. If businesses require more than the £50,000 cap they can apply to convert the BBL into a CBILS loan.
Find Out More
For more details on the differences between CBILS, CLBILS and BBILS – and which scheme could be right for your business – contact our Corporate Finance Partner, Steven Lindsay on 0161 832 6221 or email [email protected].