These changes will apply to all offers made from 1 January 2022.
The government has replaced the CBILS and Bounce Back loans, which closed on 31 March 2021, with a new scheme: Recovery Loans, which launched on 6th April 2021. The actual amount offered and the terms are at the discretion of participating lenders with the government guaranteeing 80% of the finance to the lender until 1 January 2022 and will reduce to 70% from then.
There are surprisingly few restrictions on what you can use a Recovery Loan for. You could use it to refinance CBILS/BBL loans to a lower interest rate. You can look at the post-pandemic opportunities for your business and fund them with cheap finance. As a growth opportunity, who knows when we’ll next see such cheap (relatively) unsecured finance.
The main considerations when taking out a Recovery Loan are:
When taking out any finance and looking at the repayments, keep a close eye on your cash flow. Having visibility of up to date financial information is essential – make sure someone stays on top of the simple things such as bank reconciliations, sending invoices, automating expense entry, and updating forecasts.
The British Business Bank website has a full list of accredited Recovery Loan Scheme lenders. At Wow, we’re here to talk through your options and help with any applications if needed.
Book a call at a time that suits you