What is it?
The Recovery Loan Scheme ensures businesses of any size can continue to access loans and other kinds of finance up to £10 million per business once the existing COVID-19 loan schemes close.
Who is it for?
You will be able to apply for a loan if your business:
You will need to show that your business:
- is viable or would be viable were it not for the pandemic
- has been impacted by the coronavirus pandemic
- is not in collective insolvency proceedings - further details will be provided in due course
Business that have received support under the existing COVID-19 guaranteed loan schemes will still be eligible to access finance under this scheme, if they meet all other eligibility criteria.
Who cannot apply
Businesses from any sector will be eligible to apply, except:
- banks, building societies, insurers and reinsurers (but not insurance brokers)
- public-sector bodies
- state-funded primary and secondary schools
How does it work?
The scheme launched on 6 April and is open until 31 December 2021, subject to review. The Recovery Loan Scheme will initially be available through a number of lenders accredited by the British Business Bank. New lenders under the scheme will be listed on the British Business Bank website as they become accredited.
The loan can be used for any legitimate business purpose, including growth and investment.
The government guarantees 80% of the finance to the lender to ensure they continue to have the confidence to lend to businesses.
The type of finances available
- Term loans and overdrafts will be available between £25,001 and £10 million per business.
- Invoice finance and asset finance will be available between £1,000 and £10 million per business.
Finance terms are up to six years for term loans and asset finance facilities. For overdrafts and invoice finance facilities, terms will be up to three years.
No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.
What should I do next?
The scheme launched on 6 April 2021 and is available through participating lenders. Click here to find out how to apply.
Critchleys Clients: If you have specific questions, please contact your Critchleys Accountant directly.
First Published 4 March 2021
Last Updated 6 April 2021
6 April 2021
The scheme launched on 6 April 2021 and is available through participating lenders. Click here to find out how to apply.
4 March 2021
First published.
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