New government-backed loan scheme launched
The Recovery Loan Scheme (RLS) announced in this year’s Spring Budget opened for business on 6 April. What does it offer, who’s eligible and how can a business apply?
The Chancellor’s announcement in March promised that the RLS would be open to all businesses of any size that needed loans or other kinds of finance to help them recover from the financial effects of the pandemic. The finance can be for up to £10 million and is provided by banks and other accredited lenders. It can take one or more of the following forms:
- loans
- overdrafts
- invoice finance
- asset finance
- guarantees
If the borrowing is up to £250,000 the lender won’t require any form of personal guarantee. For larger amounts the RLS provides a government guarantee on up to 20% of the debt. The annual cost for interest and finance related fees won’t be more than 14.99%, but can be less.
The scheme is open to all businesses including those which have already borrowed through other coronavirus loan schemes. A business can apply for RLS finance until 31 December 2021. This deadline will be reviewed by the government nearer the time.
To find more information about the scheme and access it contact should be made with one of the accredited lenders, details of which can be found on the British Business Bank website here.
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