In those initial weeks of the country’s economy grinding to a halt, businesses facing forced closure and time at home up to 23 hours a day, our government took action to enable access to funding support via high street banks & commercial lenders.
Two schemes were put in place by Chancellor Rishi Sunak to support the country’s economy…
To date, the second of these schemes has been the more successful. These were the Bounce Back Loans which saw businesses able to access up to £50,000 through their high street bank with no repayment for 12 months and fixed rate funding for 60 months after this period. They were quick and easy to access with no requirements to provide financials such as projections, accounts nor bank statements. Time was of the essence for lots of SMEs and this was sufficient to see through that initial period of unknown.
I think we all agree that it’s great to see most businesses now back open & operational once again, with trade back up to at least a reasonable % of what it once was. Lots of firms however are now seeing that the initial support of the £50,000 during the shutdown period isn’t enough to fully support and allow trade to continue post-lockdown…
We’re now seeing a ‘second wave’ of CBILS applications for firms as they realise the cashflow implications now they’re trading once again. This is for a number of reasons –
- Sales are only recognised after the usual period of 30- to 90-day terms on invoicing
- The cost of materials has increased for many industries as other supply chain firms look to maximise their profits
- Opportunities for expansion can only be realised with further investment
- Return of staff from furlough has an initial cashflow impact
- Holidays of finance agreements are coming to an end
CBILS lenders are still open for business, and we have access to a number of these who are approved by the British Business Bank. We have lenders that can offer unsecured loan facilities with no early settlement penalty, as well as Hire Purchase facilities that offer 12 months no repayments.
However, the deadline for application submission is only a few weeks away – 30th September.
If you think your business could benefit from a CBILS facility of up to £250,000, then get in touch with your Credo Account Manager providing the last 6 months bank statements and full unabbreviated filed accounts.
FAQs
I didn’t think my business could have a Bounce Back Loan and a CBILS?
- That’s correct, you can’t have both live at once. Our lenders are happy to agree CBILS facilities with the condition of repayment of the BBLS
Do I have to pay any interest in the first 12 months?
- NO! This is covered by the British Business Bank under the governments scheme.
Does a CBILS block me from accessing Hire Purchase & Lease contracts that you’d normally arrange for my business?
- Absolutely not. Our lenders understand that you have to look for support during a period of lockdown like we’ve just experienced. They also understand that you have to capitalise on opportunity to purchase new & used equipment.