The Coronavirus Business Interruption Loan Scheme (CBILS) is now available through participating lenders and can provide facilities of up to £5m for smaller businesses across the UK who are experiencing lost or deferred revenues, leading to disruptions to their cashflow.
Please note that crucially, the scheme simply provides the lender with a government-backed guarantee and the borrower always remains 100% liable for the debt. However, at this difficult time it may potentially change a ‘no’ credit decision from a lender to become a ‘yes’. CBILS supports term loans, overdrafts, invoice finance and asset finance.
Smaller businesses from all sectors can apply. To be eligible an SME must be UK-based in its business activity, with annual turnover of no more than £45m. You should also have a borrowing proposal which would be considered viable by the lender were it not for the current pandemic.
- Up to £5m facility: The maximum loan value will be £5m on repayment terms of up to six years.
- 80% guarantee: The scheme provides the lender with a government-backed, partial guarantee (80%) against the outstanding facility balance, subject to an overall cap per lender.
- No guarantee fee for SMEs to access the scheme: No fee for smaller businesses. Lenders will pay a fee to access the scheme.
- Interest and fees paid by Government for 12 months: The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees.
- Finance terms: Finance terms are up to six years for term loans and asset finance facilities. For overdrafts and invoice finance facilities, terms will be up to three years.
The Scottish Government have set up a business support helpline (0300 303 0660) for all business support enquiries in Scotland and request that businesses needing guidance contact them in the first instance on this number.
Additional advice is available here: https://findbusinesssupport.gov.scot/coronavirus-advice/