Government-Backed Loan Schemes

• A CBILS facility may be up to £5 million and can take the form of term loans, overdrafts, invoice financing or asset financing.
• It must be used for a business purpose and the business must have been adversely impacted by COVID-19 (for example, a significant reduction in cashflow as a result of the virus).
• Primary intention is to support trading in the UK and so the business must generate more than 50% of turnover from trading.
• The CBILS facility will be up to six years for term facilities and up to three years for other forms of facilities.
• The government guarantees 80% of the finance to the lender and pays the interest and any fees for the first 12 months.

The business must:

• be based in the UK;
• have an annual turnover of up to £45 million;
• be able to show that it would be viable were it not for the pandemic;
• be able to show that it has been adversely impacted by the coronavirus; and
• confirm, if it wishes to borrow £30,000 or more, that it was not classed as a business in difficulty on 31 December 2019.
• Effective from 30 July 2020, businesses classed as "undertakings in difficulty" prior to 31 December 2019 are able to apply for a loan under the scheme – for further information see Banking and Finance Associate, Simona Cavasio's article here.

• Over 50 accredited lenders associated with the scheme Certain businesses are not able to apply including banks, building societies, insurers, public-sector bodies and statefunded primary and secondary schools.
• It is possible to apply to another lender if one lender declines to lend.

• This scheme is available and open for applications until the end of September 2020.
• Convertible loan notes from between £125,000 to £5 million.
• Open to innovative companies facing financial difficulties due to COVID-19.
• Private investors must at least equal or match the funding.
• Intended to cover those companies who rely on equity investment and unable to access CBILS.

The business must:

• be based in the UK
• have previously raised at least £250,000 in equity investment from third-party investors in the last five years
• secure matched funding from third-party private investors or institutions
• have none of its shares traded on a regulated market, multilateral trading facility or other listing venue
• have been incorporated on or before 31 December 2019
• show at least one of thefollowing is true:
  
  • half or more employees are UK based
  • half or more reve

• Allow small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover, up to a maximum of £50,000.
• 100% of the loan is guaranteed by the government and there are no fees or interest to pay for the first 12 months.
• After 12 months the interest rate is 2.5% per annum.
• The loan is for six years and it can be repaid early without penalty but no repayment is permitted within the first 12 months.

The business must:

• be based in the UK;
• have been established before 1 March 2020; and
• be adversely impacted by COVID-19.

• The scheme is not available to certain sectors (public sector, banks, insurers, etc).
• You cannot apply for BBLS if you are already claiming under CBILS (see above), CLBILS or CCFF (see below in each case). If you have received a loan of up to £50,000 under one of these schemes you can transfer it to BBLS (before 4 November 2020).
• There are only 11 lenders participating in the scheme including main retail banks. The lender will decide whether to offer a loan or any other type of finance and the business will be responsible for paying 100% of the amount borrowed.
• It is possible to apply to another lender if one lender declines to lend.
• If your business was classed as a business in difficulty on 31 December 2019 you’ll need to confirm that you’re complying with additional state aid restrictions.

• Available for large businesses with an annual turnover of over £45 million.
• Firms with a turnover of more than £45 million but less than £250 million can apply for up to £25 million of finance.
• Firms with a turnover of more than £250 million can apply for up to £50 million of finance.
• The loans are available through accredited lenders a list of which are shown here.
• 80% of the loan is backed by the government.
• Term of the loan can be between 3 months and 3 years.
• No personal guarantees permitted for borrowing under £250,000.

The business must:

• be based in the UK;
• have an annual turnover of over £45 million;
• self-certify that the business has been adversely impacted by COVID-19;
• not have received a facility under the Bank of England's CCFF scheme.

• There are 12 lenders taking part in the scheme including all the main retail banks.
• Any applications must be accompanied by a borrowing proposal which the lender deems is viable and believes will enable the business to trade out of any short-term to mediumterm difficulty.
• Again there are exceptions to businesses that are not able to apply including banks, building societies, insurers, publicsector bodies and state-funded primary and secondary schools.
• If a business wishes to borrow more than £50 million, the business must agree to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan.

• Under the scheme, the Government buys short-term debt from large companies.
• Intention is to allow businesses to finance short-term liabilities.
• Companies and their finance subsidiaries that make a material contribution to the UK economy are able to participate.
• It is offered through commercial lenders, backed by the Bank of England.

The criteria for the CCFF are more detailed and can be found here.