The Chancellor today made a major announcement that will come as a big relief to small businesses – the Bounce Back Loan scheme.
The scheme will be open from 4 May 2020 and will enable small businesses to access unsecured loans equivalent to 25% of turnover, capped at £50,000. The loans will have no repayments in the first year of the agreement, with interest during this time being met by the government.
At the end of the first year of the loan, repayments will begin over a term of five years at a fixed interest rate of 2.5% per annum. The loans are to be 100% guaranteed by the government, and no further security can be requested by the lender under the scheme.
If you are considering taking out a bounce back loan, please ensure that you take appropriate financial advice. The scheme will be offered by high street banks, and we would recommend contacting your existing bank or building society for more information on how to apply.