Do you need financial help for medical bills or other business expenses? Is your business suffering from this pandemic? Well, the Bounce Back loan for coronavirus allows small business owners to have access to financing during the pandemic, which began a year ago. It also helps medium-sized businesses. The minimum loan amount is £2,000 and the maximum is £50,000. Another option is to borrow as much as 25% of the business turnover. The government has a guarantee of 100% of the Bounce Back loan without having to pay interest or fees for the first year. After a year, the government will charge a fee of 2.5% annually, which is still quite low.
Upgrade to Maximum Amount
If you have received one of these loans, but you did not take the full 100% of the amount you could have taken, then you can upgrade to a higher amount. In fact, you can take the maximum amount, but this had to be done by March 31, 2021. If you take a larger loan amount, it is possible that you could be entitled to additional pandemic support as a small or medium-sized business owner.
To know whether you are eligible for a Bounce Back loan or not, you should put in an application with the appropriate document and go through a loan review process. Part of the eligibility includes being a UK-based business, which had to be established prior to March 1, 2020, and business had to be negatively affected by the pandemic. If your business was in difficulty on December 31, 2019, then you have to go through a confirmation process to see if you are eligible based on additional compliance rules and restrictions.
If you are an insurer or bank, you cannot apply. The same is true for any entities from the public sector or any primary and secondary educational institutions that are funded by the state. If you have claimed to fund, you won’t be able to apply, if you already claimed under certain guidelines such as:
- The COVID-19 Business Interruption Loan Scheme (CIBILS)
- The COVID-19 Large Business Interruption Loan Scheme (CLBILS)
- The Coronavirus Corporate Financing Business
Let’s say that you obtained a loan amount of £50,000 and your business falls under one of the above schemes, you can do a transfer into the Bounce Back Loan program. However, you would have had to do this by March 31, 2021, by calling your lender to make the necessary arrangements.
Length of the Loan
You may be wondering about the length of the loan. It is for six years. However, you won’t be penalized, if you pay it off early. You have a whole year to start paying on the loan. Prior to your first loan amount becoming due, you will be contacted by your lender for further options you may have. You may be able to extend the loan term from six years to ten years. You may also be able to put the repayments on forbearance for six months. In addition, you can change to an interest-only loan for six months.
How Do You Apply
The Bounce Back Loan program has 29 participating lenders and this includes many of the retail banks in your locale. The first thing to do is to approach one of these lenders by visiting their website and sending an email showing your interest. Or you can just complete the short application form on the website to see if you meet the eligibility terms. The lender you choose will have to decide if you are qualified for a loan offer or some other kind of financing. However, when you do receive the loan, you will be fully responsible to pay it back.
The Bounce Back Loan program started on May 4, 2020, and ran until March 31, 2021. It allows small businesses to obtain loan amounts up to £50,000 as long as they are qualified. The loan process is fast as long as you provide the right documentation required. If you want to know more about pandemic loans like the Bounce Back Loan program, visit the Goalry online platform and go directly to the loanry and cashry stores to find out more.