What is the Recovery Loan Scheme?
The Recovery Loan Scheme (RLS) is currently available to businesses who may need support to access loans and other kinds of finance so that they can recover following the COVID-19 pandemic and resulting transition period.
The RLS was launched on April 6th 2021 and replaced the Bounce Back Loan scheme and Coronavirus Business Interruption Loan Scheme, which are both now closed for applications.
Am I eligible?
Businesses that are eligible to apply for the loan must be small or medium sized enterprises and trade in the UK.
Further specific criteria needs to be met in order for a business to be considered for a loan under the terms of the scheme.
The conditions are as follows:
- The business would be viable were it not for the pandemic
- The business has been adversely impacted by the pandemic
- The business is not in collective insolvency proceedings (unless in scope of the Northern Ireland Protocol in which case different eligibility rules may apply)
Businesses that received support under the earlier COVID-19 guaranteed loan schemes are still eligible to access finance under this scheme, providing they meet all other eligibility criteria.
What does it entail?
The maximum amount of finance available will be up to £2 million per business and the guarantee coverage that the government will provide to lenders has been reduced to 70% from 80%, as of 1st January 2022.
Please be advised that the Recovery Loan Scheme is due to end on 30th June 2022.
Therefore, if you wish to apply for a loan, it would be sensible to do this sooner rather than later.
Lenders that are accredited to offer Recovery Loans can be found on this list on the British Business Bank website.
As always, if you would like any further information regarding the above, please feel free to contact our offices by email info@williamsoncroft.co.uk