On Friday 3 April, the Chancellor, Rishi Sunak, announced he is taking further action to support businesses and employees affected by the coronavirus crisis, by bolstering business interruption loans for small businesses and announcing a new scheme for larger companies.
So far, more than £90 million of loans to nearly 1,000 small and medium sized firms have been approved under the government’s Coronavirus Business Interruption Loan Scheme (CBILS).
However, to maximise the support available, the Chancellor is extending the CBILS so that all viable small businesses affected by COVID-19, and not just those unable to secure regular commercial financing, will now be eligible should they need finance to continue operating.
Rishi Sunak has also announced two further significant changes:
- The government is stopping lenders from requesting personal guarantees for loans under £250,000 and making operational changes to speed up lending approvals. The government will continue to cover the first 12 months of interest and fees.
- The government have announced a new Coronavirus Large Business Interruption Loan Scheme (CLBILS), which will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £500 million. This aims to give banks the confidence to lend to more businesses which are impacted by coronavirus but which they would not lend to without CBILS. Loans backed by a guarantee under CBILS will be offered at commercial rates of interest, and further details of the scheme are due to be announced later this month.
The full press release can be found here.
For further information and advice, please visit TIGA’s dedicated COVID-19 page.