We start the New Year of 2021 under lockdown 3.0 with the uncertainty andimpact this has on our businesses. The roll out of a vaccine is of course very welcome news, but will take time, and no doubt take longer than envisaged. For countless businesses, this will cause yet more cashflow headaches.
The Government launched a number of support schemes last year including the Coronavirus Business Interruption Loan Scheme (CBILS), for businesses impacted by COVID with a turnover less than £45m and the need to borrow more than £50k, up to a level of 25% of their annual turnover.
The CBILS Scheme is currently set to expire for new applications at the end of March 2021.
Some businesses may not have considered CBILS up until this point for various reasons, including; no requirement for finance up until now, trying to survive without any assistance, being unaware of the scheme, believing they are not eligible or already having a CBILS loan in place.
Given this may be the last chance to look at the scheme, now is the time to take stock, consider what your funding needs are over the next 12-18 months and speak to us to see if the CBILS is right for your business, and we will work with you to raise the money required.
If a business has been impacted by COVID, whether that is positively or negatively, and let’s face it everyone has, there is the potential to obtain a loan over 6 years on good terms with nothing to pay for 12 months to help a business through this pandemic, and prepare and invest ready for the return of normality when it comes.
Contact us today to find out everything you need to know about CBILS, your eligibility, how it can help you and how we would go about sourcing you a CBILS loan. We act on a completely independent basis and source the right CBILS from the right funder on the right terms.
We have put together a summary of the CBILS Scheme below:
- Facilities from £50,001 to £5m
- You can have more than one CBILS
- Guideline that facility to be no greater than (i) double the annual wage bill or (ii) 25% of total turnover
- Loan terms up to 6 years or 3 years for overdrafts and invoice finance
- Government pays the fees and the interest for the first 12 months
- Can be provided by term loans, overdrafts, asset or invoice finance
- No repayments due for the first 12 months
- No early repayment penalties
- Requires a proposal package that shows that were it not for the pandemic, the business would be considered viable and this finance will enable the business to trade out of this short to medium term, i.e. cashflow forecasts to support the requirement
- Requires a full explanation on what actions have been taken to assist long term viability
- Proof to confirm that ‘not a business in difficulty’ as at 31/12/2019
- 80% Government backed but businesses will always remain liable for the loan
- No personal guarantees will be taken for facilities up to £250k.
- Personal guarantees can be requested for facilities above £250k but claims on them cannot exceed 20% of losses after all lender recoveries have been applied
- Other security can be requested for facilities above £250k but principle residences cannot be taken as security