There is so much information going around at the moment, it can be hard to keep track of what you need to hear.
Since the start of COVID-19, our goal has been to support you and your business however we can, making this transition as smooth as possible. With announcements now happening more regularly again, we want to ensure that still happens.
So, today’s agenda – Bounce Back Loans. What are they, how can they help your business and what do you need to do? Let’s bounce…
What are bounce back loans?
So, from Monday 4th May, the government announced a new loan scheme called the Coronavirus Bounce Back Loan Scheme.
This is for borrowing between £2,000 and up to 25% of your turnover, to a maximum loan value of £50,000.
The difference between this loan scheme and the Business Interruption Loan Scheme, is that rather than it being 80% backed by the government, it’s 100% backed by the government.
How does this help your business?
Well for starters, this makes it much easier for applicants to receive this loan, and the banks much more willing to lend.
There won’t be any repayments in the first 12 months, or interest charged, and the maximum loan term is six years. So, you won’t pay anything for 12 months and then the remainder of
the loan will be paid off over those remaining five years.
There are no penalties for repaying it early, so if you find that cashflow allows, you can repay it earlier without any penalties.
How to qualify for the bounce back loan scheme?
In order to qualify, you need to be based in the UK, you need to be established before 1st March 2020, and you need to have been adversely impacted by the Coronavirus.
You can’t claim this loan scheme if you’ve already got a loan through the Business Interruption Loan Scheme. However, if the loan is up to £50,000 through the Business Interruption Loan Scheme, you can transfer it to the Bounce Back Loan Scheme, provided this is done by 4th November 2020.
You will need to speak to your bank or lender to have this organised.
How to apply for the scheme?
In order to make the application, certainly with HSBC, it’s an online link through your online banking, and we believe this is the case for most other high-street lenders.
But, if you have any issues, give us a call and we’ll be able to help.
Stay safe, take care and shout if you need us.