Coronavirus – Do you need a Coronavirus Business Interruption Loan?

 In Coronavirus

If you are not sure if you have enough funds to get through the next few months then it is key that you create a cashflow forecast now, so that you can predict if and when you might run out of funds.

We have created a simple cashflow forecast tool to help you work out if you might need a loan. The tool can also be used to assess your personal expenses too, once you have assessed your business.

How do I get a cashflow template?
Please email us for a small business cashflow template, with tailored guidance notes for your specific business.

What if I complete it and have a cashflow deficit?
If you have a ‘minus’ figure on the cashflow forecast, you may need to apply for a coronavirus business interruption loan.

How do I apply for a coronavirus business interruption loan (CBIL) ?
These can be requested online from your bank. Fill out the online form available from your banks website and email it to your business bank at the email address provided. The bank will call you back to discuss further details of the loan.

What features are available?
Up to 5 million maximum facility
80% guarantee government backed, 20% backed by your bank / the lender
No fees for SME’s to access the scheme
No interest to pay for the first 12 months as the Government will pay these on your behalf
Delayed capital repayments up to six months on some loans
Unsecured lending for loans of £250,000 and under
Finance terms up to six years

Important to note
The borrower will always remain 100% liable for the debt.

Who is eligible?
You must be a UK-based business
Have an annual turnover of no more than £45 million
The loans have an eligibility criteria which you will need to read and check you are eligible before you apply.
You can find this on your banks website and read through it carefully
The scheme is open to sole traders, freelancers, body corporates, limited partnerships, limited liability partnerships or other legal entity carry out a business activity in the United Kingdom

How can the loan be used?
The loan can only be used for business purposes only and must be due to the coronavirus pandemic, not for other reasons e.g. general refinancing of the business.

Evidence to support you are a viable business
You must show in your borrowing proposal that were it not for the COVID-19 pandemic, your business would be considered viable by the lender, and for which the lender believes the provision of finance will enable your business to trade out of any short-to-medium term difficulty.

When should I act?
Now. If there is a cashflow deficit, it’s important to act now as there will be a time delay in obtaining the loan.
Always check you will be able to afford to repay the loan before you agree to it.

Need other support?
Please see our other emails for additional business support schemes available including deferred VAT and July Self Assessment payments, SSP for two weeks for directors and employees who contract coronavirus, the coronavirus job retention scheme (CVRS) and the grants available for businesses who pay rates, or get small rate relief.

In addition, if you have not done so already, please contact your insurance company to see if you are covered for pandemics and consider calling your mortgage company for a payment holiday.

Further Information

Coronavirus Business Interruption Loan Scheme (CBILS) – for SMEs and Advisors


https://www.gov.uk/government/publications/guidance-to-employers-and-businesses-about-covid-19/covid-19-support-for-businesses

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