How to get Coronavirus Business Interruption Loans
Get up to £5m for your business with a government backed loan
The UK government has introduced a series of measures to help businesses interrupted by Coronavirus.
The government will guarantee 80% of emergency loans that businesses take out. To be eligible your turnover must be less than £45m per year and your business activities must be in the UK.
The procedure is as follows:
Apply directly to your bank
Loans of up to £5m are available
The bank evaluates the proposal
The lender must consider the proposal viable if it were not for the coronavirus pandemic
All interest and fees are paid by the government for the first 12 months
Loans can be repaid over 6 years for term loans
Overdraft facilities can be put in place for up to 3 years
At the discretion of the lender, loans of up to £250,000 can be unsecured. Higher amounts will normally need to be secured.
On the face of it this scheme looks like a good option for many businesses. However, it should be noted that the banks will evaluate the loans on a normal commercial basis. The government guarantee will be an extra safeguard for them.
It’ll certainly help a lot of companies to get extra lending facilities but the banks will still request other forms of security. They’ll want security over your company’s assets and in many cases personal guarantees too.
The business interruption caused by coronavirus could be a good opportunity to evaluate the best way forward for your business.
It may be that you’re better off restructuring your business on a debt free basis. There’s also the possibility of using a government backed coronavirus business interruption loan as part of your restructuring process.
Fortress Restructuring can help with the full evaluation and application for coronavirus business interruption loans.
We will work with you to assess the best possible options for your business. We have unique experience in helping businesses in financial difficulties restructure their affairs.
The current coronavirus crisis could be an opportunity to prepare for potential difficult times ahead, re-evaluate your business strategy and get your company in stronger shape for the challenges that will be faced going forward.
Loans available include:
You borrow a fixed amount and make repayments every month for up to 6 years.
Loans secured against assets
You can borrow against assets. The assets may be land, buildings or plant and machinery.
You borrow against invoices that you have raised and are waiting for your customers to pay. This is sometimes known as factoring or invoice discounting.
Revolving Credit Facilities
Revolving credit facilities or overdrafts are where an agreed amount is available and drawn down as and when you need it. This kind of finance is useful to get over peaks and troughs in your cashflow.
Contact us on firstname.lastname@example.org for assistance in arranging a coronavirus business interruption loan for your business.