The Coronavirus Business Interruption Loan Scheme (CBILS) has been extended to 31st March 2021, applications need to be submitted prior to that date. If you are applying for asset finance, you will then have up to 6-months to activate the finance agreement.
The Coronavirus Business Interruption Loan Scheme (CBILS), delivered by British Business Bank accredited lenders, is designed to support the continued provision of finance to UK smaller businesses (SMEs) during the Covid-19 outbreak. The scheme enables us to provide facilities of up to £5m to smaller businesses across the UK who are experiencing lost or deferred revenues, leading to disruptions to their cashflow.
It supports a wide range of business finance products, of those Compass are accredited to offer the Term Loan, Sale and HP Back and Asset Finance variants. Multiple finance facilities can be utilised by a single business under the CBIL scheme, providing the total amount is under £5m.
Please note that for term loans and overdrafts, the minimum amount a lender can offer under CBILS is £50,001.
CBILS has been significantly expanded along with changes to the scheme’s features and eligibility criteria. The changes mean even more smaller businesses across the UK impacted by the coronavirus crisis can access the funding they need.
Importantly, access to the scheme has been opened up to smaller businesses who would have previously met the requirements for a commercial facility but would not have been eligible for CBILS.
Insufficient security is no longer a condition to access the scheme.
- Up to £5m facility: The maximum value of a facility provided under the scheme is £5m, available on repayment terms of up to ten years.
- No guarantee fee for SMEs to access the scheme: No fee for smaller businesses. Lenders will pay a fee to access the scheme.
- Interest and fees paid by Government for 12 months: The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.
- Finance terms: Finance terms are up to six years for term loans and asset finance facilities.
- No personal guarantees for facilities under £250k: Personal guarantees of any form cannot be taken under the scheme for any facilities below £250k.
- Personal guarantees for facilities above £250k: Personal guarantees may still be required, at a lender’s discretion, but recoveries under these are capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied. A Principal Private Residence (PPR) cannot be taken as security to support a personal guarantee or as security for a CBILS-backed facility.
- Security: For all facilities, including those over £250,000, CBILS can now support lending to smaller businesses even where a lender considers there to be sufficient security, making more smaller businesses eligible to receive the business interruption payment.
The borrower always remains 100% liable for the debt.
Smaller businesses from all sectors can apply for the full amount of the facility. To be eligible for a facility under CBILS, a smaller business must:
- Be UK based in its business activity, with turnover of no more than £45m per year.
- Have a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender
- Self-certify that it has been adversely impacted by the Coronavirus (COVID-19).
APPLYING FOR A CBILS SUPPORTED FACILITY
If you’re a print, packaging or engineering company, and would like to apply for a CBILS supported facility, please call us on 01732 833477 or email firstname.lastname@example.org.
The Coronavirus Business Interruption Loan Scheme (CBILS) is managed by the British Business Bank on behalf of, and with the financial backing of, the Secretary of State for Business, Energy & Industrial Strategy. British Business Bank plc is a development bank wholly owned by HM Government. It is not authorised or regulated by the PRA or the FCA. Visit british-business-bank.co.uk.
Please note: This scheme is just one of a number of measures announced by Government and you can find full details of the temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by COVID-19 on the Government website.