Coronavirus Business Interruption Loan Scheme

This scheme is now available. Key features:

Up to £5m facility: The maximum value of a facility provided under the scheme will be £5m, available on repayment terms of up to six years.
80% guarantee: The scheme provides the lender with a government-backed, partial guarantee (80%) against the outstanding facility balance, subject to an overall cap per lender.
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. For overdrafts and invoice finance facilities, terms will be up to three years.
Security: At the discretion of the lender, the scheme may be used for unsecured lending for facilities of £250,000 and under. For facilities above £250,000, the lender must establish a lack or absence of security prior to businesses using CBILS. If the lender can offer finance on normal commercial terms without the need to make use of the scheme, they will do so.
The borrower always remains 100% liable for the debt.

For further information see here: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils/

How to access the scheme

CBILS is available through the British Business Bank’s 40+ accredited lenders, which are listed on the British Business Bank website here.

In the first instance, businesses should approach their own provider – ideally via the lender’s website. They may also consider approaching other lenders if they are unable to access the finance they need. Decision-making on whether you are eligible for CBILS is fully delegated to the 40+ accredited CBILS lenders. These lenders range from high-street banks, to challenger banks, asset-based lenders and smaller specialist local lenders.

If the accredited lender can offer finance on normal commercial terms without the need to make use of the scheme, they will do so.

Given there is likely to be a big demand for facilities once the scheme goes live, businesses are being asked to:

Consider applying via the lender’s website in the first instance. Telephone lines are likely to be busy and branches may have limited capacity to handle enquires due to social distancing
Consider the urgency of your need – it is possible that some businesses may be looking for regular longer-term finance rather than ‘emergency’ finance, and there may other businesses with a more urgent need to speak with a lender

What type of finance is available?

CBILS supports a wide range of business finance facilities, including:

Term loans
Overdrafts
Asset finance
Invoice finance

Note: Not every lender can provide every type of finance listed.

Does this have any impact on my R&D claim?

You’ll still be eligible for R&D Tax Credits if you receive a CBILS loan. However, you won’t be able to claim SME R&D Tax Relief on any loan money you spend on qualifying development work. The reason being you can’t claim SME R&D Tax Credits on subsidised costs.

You may be able to claim R&D tax relief under the large company ("RDEC") scheme with subsidised costs. However the RDEC scheme is signicantly less generous than the SME R&D Tax Credit scheme.