A 100% government-backed loan scheme has been announces for small businesses impacted by Covid-19.
In Brief:
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It’s called the Bounce Back Loans scheme.
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Businesses will be able to borrow between £2,000 and £50,000.
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This will be interest free for 12 months.
What does this mean?
So far, schemes aimed at SMEs throughout the crisis (such as CBILS) have only covered businesses needing larger chunks of finance, or those who have already raised investment. Many groups called on the UK Government to fill this gap for those businesses that would not be able to survive the crisis, and the Chancellor has said this new scheme will help “bolster” the existing package.
A key issue was that existing finance on offer took a long time to come through and was difficult to apply for, hugely impacting companies with tight margins and cash flow problems. This solution involves filling out a “short and simple” online application, and says businesses will receive finance “within days”.
