Given the current climate, many have taken advantage of the various government-backed loan schemes available. Most commonly Bounce Back Loans (BBLS) will have been taken – lesser known are the Coronavirus Business Interruption Loan Scheme (CBILS) loans, which are for the larger business with turnover exceeding £200,000.

Recently the CBILS deadline has moved to 31 March 2021 following the Chancellor’s announcement of the third extension of the initiative – applications received after this deadline will not be eligible for this funding.

CBILS is primarily focused on providing financial support to businesses who have experienced lost revenue and cash flow disruptions due to coronavirus. To summarise:

• Access between £50,001 and £250,000 loan for working capital or business expansion with no interest for 12 months.
• The UK Government will be paying for the first 12 months interest plus any arrangement fees attached to the loan facility. Funded by the way of a “Business Interruption Payment “BIP”.
• Some lenders do not collect any capital repayments in the first year either.
• No personal guarantees for loans of up to £250,000. The borrower is 100% liable for the debt but the loan is backed by an 80% guarantee from The UK Government.
• A business cannot have both a Bounce Back Loan “BBL” and a CBILS facility however you can use the CBILS facility to refinance the BBL.
• Terms from 2 to 5 years.
• Ability to repay in full in the first 12 months at no cost at all.
• No arrangement fees or broker fees.

Quick eligibility:

• Businesses that were in distress or loss-making prior to COVID-19 would generally be ineligible.
• Businesses are typically eligible for maximum CBILS facilities on an aggregate basis up to a maximum of 25% of their previous year’s turnover.
• More than 50% of turnover from trading activity.

 You need to provide the following to the lenders: 

• Full set of Last Accounts
• Latest Management Accounts to date
• Last 6 Months Business Bank Statements
• Dates of Birth for ALL Directors / Partners
• Home address including postcode for ALL Directors / Partners
• Previous address details if less than 3 years
• Month & Year the Directors / Partners moved into home address.
• Short written statement of how your company has been affected by the Covid-19 pandemic

If you haven’t taken advantage of the scheme yet, it may be worth considering taking a CBILS loan before the March deadline, so you don’t miss out on finance that could help you. There’s unlikely to be such easy borrowing opportunities in the foreseeable future. 

We have assisted many clients with the CBILS process. If you would like more information, don’t hesitate to contact TS Partners at either our Wellington or Plymouth office.