Launched: 6th April 2021 for applications
Launched with 18 accredited lenders, expecting up to 100 lenders to participate
In summary the RLS is a funding solution “where finance is not available under a normal commercial basis”.
The scheme replaces the BBLS, CBILS and CLBILS schemes:
· Term Loan funding starts at £25,001 up to 6 years
· Invoice and Asset Finance starts at £1,000
· Scheme limited to £10m per company, or £30m per group
Scheme is a “top up” to existing BBLS and CBILS loans – total amount that can be accessed under all schemes guided by:
- 2 x wage bill or 25% of Turnover for 2019 or justified 18 months cash flow requirements
For example, if ABC Ltd had turnover of £800,000 in 2019, then their maximum total Covid support schemes’ borrowing could be £200,000. If they had already accessed a CBILS loan for £100,000 then, subject to credit assessment, they may be eligible for £100,000 funding under the Recovery Loan Scheme.
Some scheme rules are the same:
- NO PG taken on loans up to £250k
- Borrowers private residence cannot be taken as security
- 80% Government guarantee to the lender
Some changes to the rules:
- No interest free period for the borrower
- The business responsible for all fees associated with the loan
- No automatic payment holidays up front for all borrowers
- No minimum turnover or time incorporated
Proposals will be considered for all sound business and economic reasons – every application to be fully credit assessed.
Mark Grant, April 2021.
info@fiduciacommercialsolutions.co.uk 01636 614 014
