There have been many questions around what the comparisons are between the old CBILS (Coronavirus Business Interruption Loan Scheme) and its replacement the RLS (Recovery Loan Scheme).
CBILS was introduced by the Government during the COVID pandemic and had been supporting businesses with all their funding needs up until 31st March 2021. It was replaced by RLS which began on 6th April 2021 only with a few slight differences.
The key comparisons are as follows:
| Features | CBILS | RLS |
| Loan value | £50,00 to £5 million | Up to £10 million |
| Loan term | Up to 6 years | Up to 6 years |
| Government pays first 12 months interest | Yes | No |
| Government pays upfront lender fees | Yes | No |
| 80% government lender guarantee | Yes | Yes |
| Personal guarantees | Not permitted on loans up to £250,000 | Not permitted on loans up to £250,000 |
| Minimum trading history | 1 to 2 years | No minimum |
| Minimum annual turnover | No minimum | No minimum |
| Facilities | LoansOverdraftsAsset financeInvoice finance | LoansOverdraftsAsset financeInvoice finance |
| Business size | All SMEs with a turnover of less than £45 million | No restrictions |
The one area that is not covered in the above, is that of personal guarantees. If the required loan is less than £250,000 then no personal guarantee is required, this changes when the lending facility is above £250,000 and then a guarantee is required.
The RLS is due to run over a 9-month period up until 31st December 2021 with a likely review in the Autumn.
If you have any questions around RLS or are looking for some advice, please call us on 01993 706403 or e-mail enquiries@ngifinance.co.uk.