large business interruption loan scheme

Large Business Interruption Loan Scheme

The Large Business Interruption Loan Scheme which has been put in place to offer support to larger businesses affected by coronavirus.

The scheme will help medium to large sized businesses to access loans or finance up to £200 million. The government will guarantee 80% of the finance to the lender.

Who can apply?

The eligibility criteria for the Large Business Interruption Loan Scheme is:

  • the business is based in the UK
  • has an annual turnover above £45 million
  • has not received support from the Bank of England’s COVID-19 Corporate Financing Facility

Businesses will need to show that:

  • the business would be viable if not for the coronavirus pandemic
  • the business has been affected by coronavirus
  • the loan will allow trading out of short to medium-term difficulty which resulted from coronavirus

Restrictions on dividend payments, senior pay and share buy-backs will need to be agreed to if borrowing over £50 million.

Who cannot apply?

  • banks, insurers and re-insurers
  • building societies
  • public-sector bodies
  • state-funded primary and secondary schools

Businesses across all other sectors can apply as can insurance brokers.

What can be applied for?

Providing you meet the eligibility criteria you will be able to apply for:

  • loans
  • revolving credit facilities- including overdrafts
  • invoice finance
  • asset finance

A lender can provide up to 25% of your annual turnover, the maximum amount that can be borrowed is £200 million and the fiance is available from 3 months to 3 years.

The 12 lenders participating in the scheme include all the main retail banks. Applications need to be made via the lenders website and you will need the following information:

  • the amount to be borrowed
  • what the loan is for
  • the length of the loan

You will also need to provide proof that you will be able to repay the loan. Supporting documents include:

  • Accounts – management and historic
  • business plan
  • cash flow forecast
  • details of assets.

Further information and lenders can be found here, iif your a smaller business you may be entitled to support from the bounce back loan scheme or self employment income support scheme.

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