Coronavirus Business Interruption Loan Scheme
The Coronavirus Business Interruption Loan Scheme (CBILS) provides financial support for smaller businesses across the UK that are currently losing revenue and seeing their cashflow disrupted due to the COVID-19 outbreak.
The scheme is currently part of a wider package of Government support for UK businesses and employees. Follow the link to read more at the Government’s Business Support Website.
Here is how it works:
British Business Bank operates CBILS via its accredited lenders. There are over 40 of these lenders currently working to provide finance. They include:
- High-Street Banks
- Challenger Banks
- Asset- Based Lenders
- Smaller Specialist Local Lenders
A lender can provide up to £5 million in the form of:
- Term Loans
- Overdrafts
- Invoice Finance
- Asset Finance
CBILS gives the lender a Government-backed guarantee for the loan repayments to encourage more lending.
CBILS: KEY FEATURES
- Up to £5m facility:
The maximum value of a facility provided under the scheme will be £5m, available 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, so smaller businesses will benefit from no upfront costs and lower initial repayments.
- 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.
- Security:
At the discretion of the lender, the scheme may be used for unsecured lending for facilities of £250,000 and under. For facilities above £250,000, the lender must establish a lack or absence of security prior to businesses using CBILS. If the lender can offer finance on normal commercial terms without the need to make use of the scheme, they will do so.
- The borrower always remains 100% liable for the debt.
For more information please follow the link.
Related news
Follow the link for Mansfield District Council’s & Ashfield District Council’s update advising people facing financial difficulties during the COVID-19 pandemic.
View article about Mansfield & Ashfield District Council – Update on Financial Help & AdviceAs from 5pm on Friday 27th March the office will be closed, however the phones will be manned and this will enable you to contact Brian, Glen & Phil.
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