The impact of Covid 19 pandemic has been felt worldwide. In order to easy the pressure on businesses, the Government of UK has come up with Coronavirus Business Interruption Loan Scheme. The scheme ensures that businesses in the UK are not put to extra pressure with respect to loan repayment and can focus on stabilizing their income.
The scheme came into force from 6th April 2021 and applications will be accepted till 31st December 2021. However, there are certain eligibility criteria that should be met.
Eligibility Criteria for Covid 19 Business Recovery Loan Scheme
As a business entity, your application will only be considered if you comply with the given eligibilities:
- Your trade operates in UK
- Sufficient information to showcase:
- Trade would have been healthy in absence of this pandemic
- Trade has suffered a downfall because of the pandemic
- Trade has not filed for insolvency
Additionally, an enquiry can also be made with respect to credit and fraud check.
Who cannot apply for this scheme?
The scheme is not applicable to:
- Schools (primary and secondary, who are funded by the state)
- Public sector entities
- Banks and insurance bodies
How to apply?
If you are eligible for Covid 19 Business Recovery Loan Scheme, then you can apply to British Business Bank. The mode of application is via any lender who is accredited by BBB. Some of the most preferred list of banks include Natwest, Lloyds, Barclays and HSBC.
Detailed information about the scheme
In this scheme, the Government of UK offers 80% guarantee of the loan availed by the business, subject to overall cap. The guarantee is offered to the bank and not to the borrower. Therefore, the borrower is liable to pay 100% of the loan amount.
In case you are already availing some other Covid 19 loans, you can still avail this scheme.
The minimum amount is £1,000 and can be extended upto£30 million, for group of companies. For individual businesses the minimum amount remains the same and the benefit can be extended upto£10 million.
The mode of guarantee covers term loans, invoice finance, asset finance and overdrafts.
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