The RLS is set to replace the existing coronavirus finance support schemes (the Coronavirus Business Interruption Loan Scheme (CBILS), Coronavirus Large Business Interruption Loan Scheme (CLBILS) and Bounce Back Loan Scheme (BBLS)). The scheme will run from 6 April 2021 until 31 December 2021, subject to review.Speak to a Business Advisor Today
The maximum value of a facility provided will be £10 million per business and once received, the finance can be used for any legitimate business purpose, including growth and investment. The government guarantees 80% of the finance to the lender.
The main difference with the RLS to the existing COVID-19 schemes is that there are no turnover restrictions: businesses of any size can apply for finance under the RLS, the maximum loan amount available to each business is £10,000,000.Another difference between the RLS and existing COVID-19 financial support schemes, is to do with interest and fees that are payable on the loan. The British Business Bank will no longer pay the borrower’s interest and fees for the first 12 months.
This means the borrower will have to pay the interest themselves from day one.No personal guarantees will be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.
Term loans and asset finance facilities are available for up to six years, with overdrafts and invoice finance available for up to three years
Term loans and overdrafts will be available between £25,001 and £10,000,000 per business.Invoice finance and asset finance will be available between £1,000 and £10,000,000 per business.The term of the loans will be as follows: Up to six years for term loans and asset finance facilities. Up to three years for overdrafts and invoice finance facilities.
Businesses from any sector will be eligible to apply, except: banks, building societies, insurers and reinsurers (but not insurance brokers) public-sector bodies state-funded primary and secondary schools