Coronavirus Business Interuption Loan Scheme (CBILS) - What You Need to Know

March 15, 2020

What is CBILS?

CBILS is a scheme provided by the British Business Bank through participating providers (over 40 signed up), and will offer more attractive terms for both businesses applying for new facilities and lenders, with the aim of supporting UK businesses during the Covid-19 outbreak.

The scheme provides the lender with a government-backed guarantee against the outstanding facility balance, potentially enabling a ‘no’ credit decision from a lender to become a ‘yes’. NB – the borrower always remains 100% liable for the debt.

The Government will also cover the first 6 months of interest payments, so businesses will benefit from lower initial repayments. The business remains liable for repayments of the capital.

Who is eligible?

To be eligible for support via CBILS, the small business must:

  • Be UK based, with turnover of no more than £41 million per annum
  • Operate within an eligible industrial sector (a small number of industrial sectors are not eligible for support – see https://www.british-business-bank.co.uk/wp-content/uploads/2020/03/Ineligible-and-Restricted-Eligibility-Sector-2017.pdf)
  • Be able to confirm that they have not received de minimis State aid beyond €200,000 equivalent over the current and previous two fiscal years
  • Have a sound borrowing proposal, but insufficient security to meet the lender’s requirements

How much can I borrow?

The maximum value of a facility provided under the scheme will be £5 million pounds. There are a wide range of business finance products available including:

  • Term facilities
  • Overdrafts
  • Invoice finance facilities
  • Asset finance facilities

How do I apply?

Unfortunately, no details have been published yet, however it is widely anticipated that more information will be available from Monday 23 March 2020.  As soon as information is available we will update you.

In the meantime, we would suggest contacting your current bank manager to discuss the likely information they will require from you to make your application process as smooth and as quick as possible. You may also wish to look at other finance providers to see if they can offer an alternative facility.

If you would like to discuss this, or any other area of your business needs please do get in contact info@linggardandthomas.co.uk

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