The Government backed loan schemes set up to support businesses through the COVID-19 pandemic were closed on 31st March 2021. However a new scheme, the Recovery Loan Scheme, will launch on 6th April 2021 and will remain open until 31st December 2021.
The Recovery Loan Scheme, which is open to businesses of any size, will provide access to loans and other kinds of finance up to £10 million per business. Once received, the finance can be used for any legitimate business purpose, including growth and investment.
The Scheme will be available through a network of accredited lenders, still to be announced; with the Government guaranteeing 80% of the finance to the lender .
The following types of finance will be available:
- Term loans and overdrafts will be available between £25,001 and £10 million per business.
- Invoice finance and asset finance will be available between £1,000 and £10 million per business.
Finance terms are up to six years for term loans and asset finance facilities. For overdrafts and invoice finance facilities, terms will be up to three years.
No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.
You will be able to apply for a loan if your business is trading in the UK; and you can show that your business: is viable or would be viable were it not for the pandemic; has been impacted by the coronavirus pandemic; and is not in collective insolvency proceedings
Business that have received support under the existing COVID-19 guaranteed loan schemes will still be eligible to access finance under this scheme, if they meet all other eligibility criteria.
Details of how to apply have not yet been made public.