The temporary Coronavirus Business Interruption Loan Scheme (CBILS), delivered by the British Business Bank, is to support businesses to access bank lending and overdrafts.

The government will provide lenders with a guarantee of 80% on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to SMEs.

The government has extended the deadline for CBILS applications until 30 November.

The government will not charge businesses or banks for this guarantee, and the scheme will support loans of up to £5 million in value for up to 6 years.

Businesses can access the first 12 months of that finance interest free, as the government will cover the first 12 months of interest payments, meaning lower initial repayments for businesses struggling with cashflow.

Businesses with a turnover of up to £45m are eligible to access loans, overdrafts, invoice finance and asset finance.

There are over 40 accredited lenders in the scheme including high street banks, challenger banks, asset based lenders and smaller specialist lenders.

The borrower remains 100% liable for the debt. Personal guarantees for loans of up to £250,000 will not be required. For loans over £250,000 personal guarantees may still be required, at a lender’s discretion. More details about eligibility can be found on the British Business Bank’s website.

Ellacotts has partnered with Capitalise to help source CBILS funding for businesses.

The government has also launched the Coronavirus Bounce Back Loans for smaller businesses.

Please contact us to see how we can help you access a CBILS loan to support your business.