Fylde MP Mark Menzies has welcomed the Government’s Bounce Back Loan Scheme to help small and medium businesses.
The scheme will help small and medium-sized businesses to borrow between £2,000 and £50,000. The government will guarantee 100 per cent of the loan and there won’t be any fees or interest to pay for the first 12 months.
Mr Menzies was previously critical of the banks after business owners revealed difficulties in accessing the Coronavirus Business Interruption Loan Scheme which has an 80 per cent guarantee. Many businesses reported banks applying full commercial lending procedures to them.
He said: “These new Bounce Back loans have been designed to make the borrowing process easier for small businesses.
“They are fully guaranteed by the Government so the banks should be able to get these funds to businesses with less bureaucracy. While there will still be checks to ensure lending is not on a disproportionate scale, this scheme should get funds to where it matters quickly.
“Our small and medium businesses are the lifeblood of our towns and villages. I hope they apply for all the help they need through this scheme.”
Loan terms under the Bounce Back scheme will be up to six years. No repayments will be due during the first 12 months. The government will work with lenders to agree a low rate of interest for the remaining period of the loan.
The scheme will launch on 4 May 2020 and will be delivered through a network of accredited lenders.
You can apply for a loan if your business:
- is based in the UK
- has been negatively affected by coronavirus
- was not an ‘undertaking in difficulty’ on 31 December 2019
Who cannot apply
The following businesses are not eligible to apply:
- banks, insurers and reinsurers (but not insurance brokers)
- public-sector bodies
- state-funded primary and secondary schools
If you’re already claiming funding
You cannot apply if you’re already claiming under the Coronavirus Business Interruption Loan Scheme (CBILS).
If you’ve already received a loan of up to £50,000 under CBILS and would like to transfer it into the Bounce Back Loan scheme, you can arrange this with your lender until 4 November 2020.