CBILS – Coronavirus Business Interruption Loan Scheme

The UK government are looking to support SME’s through this period of unprecedented period of uncertainty. We are working closely with a number of lenders to submit applications for our clients.

Criteria: 

  • £25,001 – £100,000 – Secured by short form guarantee
  • £100,001 – £250,000 – Secured by short form guarantee and debenture
  • £250,001+ – PG, debenture and tangible security
  • Loan Term – 1 – 6 years
  • No arrangement fees
  • No security fees
  • No interest payments for 12 months
  • We will charge a 2% success fee

How it is calculated? 

  1. The annual wages bill of your business (including social charges as well as the cost of personnel working on the business’ site but formally in the payroll of subcontractors) for 2019, or the last year available. If your business was established on or after 1 January 2019, you can provide an estimated annual wage bill for the first year of operation;
  2. The turnover of your business in 2019; or
  3. The liquidity needs of your business from the moment the loan is granted for the coming 18 months (or for the coming 12 months, if your business has more than 250 employees). Your business liquidity plan may include both working capital and investment costs.

Key points: 

  1. Must be UK-based in its business activity, with annual turnover of no more than £45m
  2. Have a borrowing proposal which, were it not for the current pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable the business to trade out of any short-to medium term difficulty.
  3. The borrowing business remain 100% liable for the debt, including any accumulated interest even if the Government guarantee has paid out.
  4. The Department for Business Energy and Industrial Strategy (BEIS) provide the Bank with a limited guarantee of up to 80% of the capital of eligible CBIL. 5. Unlike the Enterprise Finance Guarantee (EFG) Scheme, no guarantee fee is payable to the UK Government under the CBIL Scheme.

Amount:

  • On what basis has the requested loan amount been calculated?
  • Has this been based on existing (pre virus) income and expenditure levels or future levels? If future, what are assumptions are being used

Purpose: 

  • What is the purpose of the facility (short term cash flow/longer term cash injection) and how will the funds be specifically used?
  • How will the funds be used to address the cash shortfall caused by Covid-19?
  • When the Pandemic is resolved, how long do you believe it will take to start recovery?
  • What challenges will you face e.g. future loss of contracts/staff availability?
  • What changes is the business making in the short and longer term to help drive business performance back to either pre virus levels or beyond?

Restrictions apply in the following sectors: 

  • Aid for Export
  • Using CBIL funding abroad
  • Preferential use of domestic over imported goods
  • Agriculture (including horticulture)
  • Coal
  • Fisheries
  • Forestry
  • Transport

Viability: 

  • What are your largest overheads currently e.g. staffing costs, business premises costs, stock and or/other debt costs and what if anything have you been able to do to reduce any of these if possible?
  • How do you feel the borrowing will support the longevity of the business?

Government help:

  • Have you accessed other government schemes in response to Covid-19?
  • If Yes please provide details below and Quantify how these will help cash flow.

What do we need?

  1. Last Year’s Accounts – must be profitable
  2. 6 Months Bank Statements
  3. Copy of a Void Cheque for the Business Account (not for every lender)
  4. ID and Proof of Address for Director
  5. Income & Expenditure
  6. Brief outline of how COVID-19 will affect the business and why funding is needed

Please do not hesitate to contact us to apply or for more information.

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