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Michelle Monck

Consumer Finance Expert
Published: 22/09/2020
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The Coronavirus Business Interruption Loans Scheme (CBILS) closes to applications at the end of this month. Businesses have just days left to apply for business loans, invoice finance, asset finance and overdrafts that offer 12-months interest free and payment holidays. CBILS lenders will then have until the end of November 2020 to process all CBILS applications.

Data published this morning by HM Treasury shows that a total of £15.45bn to 66,585 businesses was lent under CBILS; an approval rate of 47%. The larger CBILS loan scheme has lent £3.84bn and bounce back loans have totalled £38.02bn of lending to over 1.2 million businesses.

Can CBILS help businesses to survive the economic downturn?

The job retention scheme ends next month, and the hospitality industry now faces increasing restrictions on trade. As the economic outlook worsens, many small businesses may find their cashflow is restricted as customers take longer to pay invoices or even fail to pay at all. Other businesses will have had a cashflow hit after a period of reduced income and now need cash to pay returning furloughed staff. Money using CBILS either through an invoice finance scheme to release cash quickly from unpaid invoices or a loan to help boost reserves could be useful to help businesses survive the potential turbulence of the coming months.

Ultimate Finance, a CBILS lender offering invoice finance, asset finance and term loans to businesses helped a specialist contractor with a £500,000 CBILS to help them bridge the gap between having to pay returning furloughed staff and receiving income from projects to be completed. As an existing Ultimate Finance customer, the business did not need to provide additional security and had a capital repayment holiday of 3 months.

Melanie Howarth, Relationship Manager at Ultimate Finance says, “The Business Interruption Loan Scheme has been very popular with our existing clients and new prospects, be it through our Invoice Finance, Asset Finance or Bridging Finance facilities. It’s great to be able to help UK businesses stand strong against the impact of the pandemic through our accreditation by the British Business Bank. The term loan enabled our client to retain their staff and prevent any redundancies, which is a relief. They’re now in a great position to take on new contracts and make up for lost revenue”.

For some businesses there may also be the opportunity to use funds from CBILS to improve their business for the future, such as investment to allow them to diversify into new business areas or to improve their current processes.

How to get your application for CBILS started

Small and medium sized businesses that are viable and have been trading for at least three years can still apply for a business loan of between £50,000 up to £5 million under CBILS. With the deadline so close businesses will need to make sure their application has a strong likelihood of success with their chosen lender to avoid missing out. Alternatively, businesses can deal with a specialist CBILS broker that will quickly access their application and identify a lender or lenders most likely to agree a CBILS loan.

What is CBILS?

  • Loans of £250,000 up to £5,000,000 (loans below this may be applicable under Bounce Back Loans)
  • No repayments in the first 12-months and no interest charged during this period
  • Loan terms of one to six years
  • No early repayment charges

Read the full eligibility criteria in our guide to CBILs or arrange to speak with our preferred specialist CBILS broker.


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