In May 2020 the Government launched the Bounce Back loan initiative, a COVID-19 support package for small businesses needing to raise business finance up to £50,000. It provides businesses with a loan where the first year of interest is paid for by the Government and the business does not need to make any payments until month 13. Alongside this runs the CBILS (coronavirus business interruption loan scheme) which was launched in March 2020 to again support businesses with their funding needs. One of the key differences between the two is that CBILS can provide up to £250,000 of support without any personal guarantees.
Both the bounce back loan scheme and CBILS have been extended until January 2021. Meaning that you can apply for business funding of up to 25% of your turnover without worrying about making any payments until Month 13.
All the proactive businesses that took out an early bounce back loan will know that their first repayment is due in May 2021. These businesses will need to start planning now, for the additional payments that will have to be made in the New Year. Something that they might not have considered is that, if they did not take the full £50,000, then they can apply for a top-up loan. Alternatively, if additional funds in excess of £50,000 are required then a business could consider applying for a CBILS, pay off the balance of the bounce back loan and then use the balance to fulfil their business growth needs.
If you have any questions regarding the bounce back loans or need some additional funding then feel free to call us on 01993 706403 or e-mail enquiries@ngifinance.co.uk.