Businesses will be able to borrow between £2,000 and up to 25% of a business’ turnover. The maximum loan amount is £50,000. The cash is expected to arrive within days.
The scheme gives the lender a full (100%) government-backed guarantee against the outstanding balance of the facility (both capital and interest). Businesses can apply online through a short and simple online form, with only seven questions.
The government will cover the cost of any fees and interest for the borrower for the first 12 months. No repayments will be due during this 12 month period.
The rate of interest will be 2.5% per annum.
The length of the loan is six years but early repayment is allowed, without early repayment fees.
The loans are available through a network of lenders.
Lenders are not permitted to take personal guarantees or recovery action over a borrower’s personal assets (such as their main home or personal vehicle). There is no fee to access the scheme for either businesses or lenders.
You can apply for a loan if your business:
of £50,000 or less can apply to have these switched over to this generous new scheme until 31st March 2021.
Before your first repayment is due, your lender will contact you about further options to:
Disclaimer: This note does not contain a full statement of the law and it does not constitute legal advice. Please contact us if you have any questions about the information set out above.
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