The Bounce Back Loan Scheme (BBLS) gives businesses a way to access finance quickly during the coronavirus crisis.
Applications for the Bounce Back and Coronavirus Business Interruption Loan Schemes (CBILS) close on 30 November. However, some business owners will still be undecided about whether a loan is right for them.
We’ve compiled advice and information on the loan schemes, alternative support and financial planning to help you make a decision about what is the best option for your business.
Want to learn more about the BBLS and CBILS?
The British Business Bank has a comprehensive FAQs section that explains how each loan works. There’s useful information on the differences between each scheme and how the BBLS compares to other finance like Start Up Loans.
There are no restrictions on how business owners spend the loans, providing it’s for the economic benefit of the business. You can read examples of how other businesses are using coronavirus financial support on gov.uk and Be the Business.
Need help with making an application?
However, applying to a scheme through your regular business banking provider can help to streamline the process. Some lenders will only accept applications from existing customers.
To apply for the BBLS, you will need to complete a short online application form. Some lenders will require additional documents, but Santander suggests you will only need:
- Company name, address and registration number
- Estimated turnover for 2019
The CBILS requires more preparation. Before starting an application, businesses can quickly check their eligibility through this checklist. Bear in mind that this only checks that you’re eligible to apply and doesn’t guarantee that your application will be successful.
The supporting documents for the CBILS will vary between lenders, but the British Business Bank recommends preparing the following:
- Management accounts
- Business plan
- Historic accounts
- Details of business assets
Looking for information about alternative coronavirus support?
The government has a dedicated business support finder that lists all the loans and grants available. It’s worth checking what grants are available before making a loan application.
If your business has been forced to close due to local lockdown restrictions, you may be eligible for the Local Restrictions Support Grant (LRSG).
This grant supports businesses that can’t provide the usual in-person customer service from their premises and have been required to close for at least three weeks. Examples of eligible businesses include non-essential retail, cafes and restaurants that operate primarily as in-person venues.
You will be able to apply for the grant through your local council website.
The Job Support Scheme is introduced from 1 November to protect viable jobs in businesses facing lower demand due to coronavirus. You may also be eligible for the government’s Job Retention Bonus if you furloughed employees and keep them continuously employed until 31 January 2021.
For more general business support and one-on-one advice, Enterprise Nation has partnered with the Department for Business, Energy and Industrial Strategy to offer small and medium-sized businesses free advice on coronavirus recovery. There’s a list of some of the business advisers taking part here.
Require additional guidance on how loan repayments work?
The government recently announced its Pay As You Grow scheme, which provides additional flexibility for businesses that may struggle with repayments.
Using a calculator like this can give you a better understanding of how your BBLS repayment schedule could look.
Want advice on managing your cash flow and forecasting?
Having a good grasp on your current cash position and forecast for the next three months will help you to decide whether to take out a loan and how much finance you might need.
Accountants The Wow Company have a useful support hub on cash flow management during coronavirus. There’s information on tracking key metrics and deferring payments, plus a simple template for monitoring your cash position.
We spoke to business leaders about the specific approaches they’re taking at the moment. You can read about how they’re creating cash flow forecasts and staying one step ahead here.
The prospect of planning for 2021 can seem especially daunting right now. This guide from Deloitte is packed full of practical advice on building a planning process that’s flexible and sustainable.