Coronavirus Business Interruption Loan Scheme

Overview

The CBILS is a new scheme announced by the Chancellor in March. It came into force on 23rd March 2020 and was updated on 3rd April 2020 to expand the offering to businesses that were previously excluded. It is designed to help businesses raise finance for purchases, working capital and general business purposes through commercial loans, asset finance and invoice finance during these uncertain times.

Broadly, the scheme operates in a similar way to The Enterprise Finance Guarantee (EFG) schemed performed, i.e. the commercial lender (Bank, Building Society, Specialist Lender) is responsible for making lending decisions based on the viability of a company’s proposal.

There are some key differences:

Facility limit – £5 Million
Up to £5 Million available depending on the size and requirement of your business

Finance term – Up to 6 years
Terms available up to six years, shorter terms are available

Guarantees – No Personal Guarantees up to £250,000.00
The scheme was recently amended to remove the requirement for personal guarantees against the lending

Cost – Commercial terms but first 12 months interest paid
A business interruption payment backed by the government will be paid to the lender to cover the first 12 months of interest, meaning 12 months of lower monthly payments

Lender Guarantee – 80% of the advance
The Government provides lenders with an 80% guarantee against losses they might experience should a customer cease trading

Further source information can be found here:

https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/

https://www.gov.uk/guidance/apply-for-the-coronavirus-business-interruption-loan-scheme

https://www.gov.uk/guidance/apply-for-the-coronavirus-large-business-interruption-loan-scheme

 

Our team of relationship managers and finance experts have reviewed these pages in great detail so we will help you navigate to the pertinent points throughout the application process.

As of the 17th April 2020, only £1.1 Billion of a potential £330 Billion has been approved. The logistics of providing the scheme quickly and effectively can be greatly improved by ensuring your application is fit for review and contains the information the lender requires to make a positive decision. This is where we can help…

Why Claratus?

Claratus was incorporated by two founding Directors in 2014 with the aim of providing clear, fair and effective finance to SME’s. Never more so than in the current times of uncertainty is this ethos important. Time is of the essence, with payment issues throughout the UK’s supply chain you can rely on Claratus to review every case and ensure the optimum chance of success.

We have extensive knowledge and experience, including demonstrable success in arranging and completing EFG loans (the foundation of CBILS) previously.

We are well capitalised and well-staffed to ensure applications are reviewed and processed without delay.

We have an established panel of lenders with signed trading agreements which ensures quicker underwriting decisions.

We have a well-trained internal credit team to review every case before submission, checking for errors and ensuring the right level of information is provided to any funder. This again avoids unnecessary delays.

Claratus can act as a single point of contact for your company to access a panel of over 50 lenders, including a large proportion of those accredited for CBILS.

We have a genuine desire to see viable businesses successfully navigate this turbulence and subsequently thrive once restrictions are lifted and we return to normality.

Disclaimer: We do not have direct control on acceptances for CBILS, the decision is made by the lender with support of the British Business Bank.