Whilst we await the formal announcement, it would appear that the Government have reviewed the application process for funding under the Coronavirus Business Loan Interruption Scheme (CBILS)
What are we expecting to change?
– Firstly, it looks as if the Government are not making a requirement that finance is first sought through the normal commercial channels. This is a good thing (in a way), for if your High Street Bank offered you terms on a loan, you were effectively prevented from proceeding to the CBILS. High Street Banks were entitled to charge whatever interest rate they felt appropriate and ask for appropriate security (including personal guarantees). It now looks as if you can proceed straight to CBILS.
– The CBILS scheme has also changed so that rather than it being discretionary for the High Street Lender to choose whether or not to ask for security – the Government is (hopefully) making it a condition that lending is granted without any requests for a personal guarantee.
– The Government are still planning to pay the first 12 months interest.
– The scheme is open to Limited Companies, Partnerships, Sole traders, Contractors and Freelancers
– The loan will still need to be repaid
– The borrower remains 100% liable to repay the debt
I would anticipate that some of these changes will make it far more palatable for small and medium sized businesses to consider obtaining funding from this source, and in so doing, help ride the storm. We will have to wait for the formal announcement, possibly later today, to get more details and I will write again once we have those details.
In the meantime, please do not hesitate to get in touch for any help or clarity on a particular point you may need.
– Landline – 01326 660022
– Mobile/WhatsApp/Text – 07779799995 – Mike Hutchinson
– Zoom ID – 205 677 7765 – Mike Hutchinson