As the Bounce Back Loan Scheme launches, the government has announced the interest rate for the 100% state-backed funds will be 2.5%, with no repayments required for the first 12 months
From today (4 May 2020), small businesses will be able to apply for the loans through an online portal hosted by the British Business Bank. Lenders will be able to provide a six-year loan from between £2,000 to £50,000 so long as the loan is no more than 25% of annual turnover.
Business can only apply for the loan if they are based in the uK, have been negatively affected by covid-19 and were not an ‘undertaking in difficulty’ on 31 December 2019.
Business that have already claimed under the Coronavirus Business Interruption Loan Scheme (CBILS) cannot not apply, though if the existing loan is under £50,000 it will be transferred to the new scheme.