Bounce Back Loans + COVID-19 Update

We hope you and your family are safe and well. The COVID-19 pandemic is impacting nearly every aspect of our lives and will be remembered as a pivotal time in history. Like any other event that impacts the world, we don’t know what the future will be like, but we do know that the other side of this will require resilience and creativity from all of us.

In terms of government news and updates for business, this has been a big week for small businesses that are short of cash as loans are more more accessible with reduced eligibility criteria

Bank Loan 1

Bounce Back Loans

The key thing announced this week by the government is a “Bounce Back” loan scheme. Some details:

It will launch on May 4th. The scheme will help small and medium-sized businesses to borrow between £2,000 and £50,000.

The loan amount will be capped at 25% of your annual turnover

The government will guarantee 100% of the loan and there will not be any fees or interest to pay for the first 12 months.

Loan terms will be up to 6 years.

No repayments will be due during the first 12 months. The government will work with lenders to agree a low rate of interest for the remaining period of the loan.

To be eligible, you will need to complete a statement on how your business has been negatively affected by Covid-19 and be solvent at 31 December 2019

You can read more on the government business support website where they will be making more information available in the next few days.

If you’d like to discuss applying for this loan or any other funding, please contact us.

Planning for now and the future under COVID19

If you are considering applying for a Bounce Back loan, I would recommend that you only borrow what you think you will need. I would also strongly recommend preparing a budget and cashflow forecast even if the loan application process doesn’t require one.

Why should I prepare a forecast if the bank doesn’t want one?

Quite simply

  1. so you know that you are applying for the right amount of money to get you through this crisis
  2. so that you know yourself what you need to do to ensure that you can meet the loan repayments when they start after the 1st year

The last thing we want to happen is for you to overborrow now and fail to make the loan repayments in the future causing you, your business and your family even more stress

If you need help with this, please let me know.

Fork In The Road 2

Are you adapting?

Businesses that use the Coronavirus setback as an opportunity to adapt, innovate and improve are the ones that will thrive. You may need to modify your offerings, look into offering online services and see what you can do differently.

Also, use this time now to think about your plan for when you reopen. Indeed we are happy to chat with you about this, your financial controls or whether you’re embracing the right technology.

This is all covered in our Guide to Developing Your Business Continuity Plan in Response to Covid-19 which we would be happy to go through with you if you’re interested  Download our guide

Take care of yourself

We know that this is a hard time. Everyone is throwing words around like “uncertain” and “unprecedented”, while business feels more stressful than ever. Please take time out today to look after yourself. We will get through this.

Thank you for your continued patience. If you have any questions or concerns, don’t hesitate to reach out to us. We are all in this together!