What is it?
Businesses that took out government-backed Bounce Back Loans to get through Covid-19 now have greater flexibility to repay their loans.
Who is it for?
Bounce Back Loan borrowers will now have the option to tailor payments according to their individual circumstances.
How does it work?
The Pay as You Grow repayment flexibilities enables borrowers to tailor their repayment schedule. It will provide businesses with the following options:
- Extend the length of the loan from six years to ten.
- Make interest-only payments for six months, with the option to use this up to three times throughout the loan.
- Pause repayments entirely for up to six months (this option is available to all from their first repayment, and means that businesses can choose to make no payments on their loans until 18 months after they initially took them out.)
This is in addition to the government covering the costs of interest for the first year of the loan.
What should I do next?
From 8 February 2021, lenders will begin reaching out to borrowers to provide information on repayment schedules and access to flexible repayment options. Businesses that have taken out a Bounce Back Loan should only expect correspondence three months before their first repayments are due.
Critchleys Clients: If you have specific questions, please contact your Critchleys Accountant directly.
First Published 8 February 2021
Last Updated 8 February 2021
8 February 2021
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