Budget 2021 - The Recovery Loan Scheme

RECOVERY LOAN SCHEME

The loan schemes started last year, CBILS and BBLS, have now closed. On 6 April 2021 a new loan scheme was set up, the Recovery Loan Scheme. The basics of this scheme are as follows:

• 80% government guarantee
• interest rates capped at 14.99%
• invoice and asset finance available from £1,000, loans from £25k to £10m
• available from high street banks and other approved lenders
• can be obtained in addition to existing CBILS and BBLS loans
• no personal guarantees required from borrowers if borrowing is less than £250k
• scheme set to close on 31 December 2021

It's important to note that this scheme is a loan scheme rather than a grant scheme and the loan will bear interest and need to be repaid. We always recommend carrying out a forecast exercise, for cash flow as a minimum, preferably a profit and loss projection as well, prior to applying for new borrowing.