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About The CBILS Scheme
The Coronavirus Business Interruption Loan Scheme (CBILS) provides financial support to smaller businesses (SMEs) across the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak.
The scheme is a part of a wider package of government support for UK businesses and employees. Read more at the Government’s Business Support website. Click Here
How It Works
British Business Bank operates CBILS via its accredited lenders. There are over 40 of these lenders currently working to provide finance. They include:
> High-street banks
> Challenger banks
> Asset-based lenders
> Smaller specialist local lenders
A lender can provide up to £5 million in the form of:
> Term loans
> Overdrafts
> Invoice finance
> Asset finance
CBILS gives the lender a government-backed guarantee for the loan repayments to encourage more lending. The borrower remains fully liable for the debt.
Finance of up to £5 million
Guarantee to the lender to encourage them to lend
Government pays interest and fees for 12 months
The maximum value of a facility provided under the scheme is £5 million, available on repayment terms of up to six years.
The scheme provides the lender with a government-backed, partial guarantee against the outstanding balance of the finance.
The borrower remains 100% liable for the debt.
The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied charges.
Finance Terms
Security
No guarantee fees for businesses
For term loans and asset finance facilities: up to six years.
For overdrafts and invoice finance facilities: up to three years.
If a lender can offer finance on normal commercial terms without making use of the scheme, it will do so.
The lender can choose to use the scheme for unsecured lending for facilities of £250,000 and under.
For facilities above £250,000, it must establish that the borrower is unable to provide security, before it uses CBILS.
Primary residential property cannot be taken as security under the scheme.
There are no guarantee fees for SMEs. Lenders pay a fee to access the scheme.
