Bounce Back Business Loans welcomed by SMEs
Small businesses affected by Covid-19 have been promised loans of up to £50,000 which could be a lifeline to many of the SMEs we work with said Commercial Solicitors at Pearson.
The bounce back measures announced by Chancellor Rishi Sunak recently are new "quick and easy" loans scheme. He also confirmed that the Government will guarantee 100% of the cash.
The Chancellor has stated that they will be easier for small firms to access and could mean applicants getting their money within 24 hours.
“The Chancellor’s recent announcement of bounce back loans for small businesses is welcome news, but key to this latest scheme’s success will be simplicity of access and speed of delivery; small businesses up and down the country need access to these funds now and with as little administrative headache as possible,” said Keith Kennedy, Partner and Head of Corporate and Commercial.
The “micro-loans” will be worth up to 25% of turnover, capped at £50,000 and the loan scheme will launch on Monday, 4th May 2020.
The scheme is designed to encourage lending to firms when they might ordinarily turn down a loan application, because the Government steps in and takes on the risk.
Key features of the new scheme include:
- Businesses will be able to borrow between £2,000 and £50,000 and access the cash within days
- Loans will be interest free for the first 12 months, and businesses can apply online using a short and simple form
- All firms trading as of 1 March 2020 will be able to get cash
- Banks will no longer require forward financials or business plans
“Being an SME ourselves, we fully understand the ever changing stresses and strains all such businesses are under, and we look forward to continuing to support our SME clients during these hugely challenging times,” added Keith.
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