New Recovery Loan Scheme Launches

Date: 07/04/21

New Recovery Loan Scheme Launches

The new government-backed Recovery Loan Scheme launched yesterday, which will ensure businesses have continued finance available to them to recover following the end of previous COVID-19 loan schemes.

Businesses of any size will have access to the scheme and, at the discretion of the lender, will have access to up to £10 million per business in loans and other types of finance.

The government guarantees 80% of the finance to the lender. As the borrower, you are always 100% liable for the debt.

If you have received support under the earlier COVID-19 guaranteed loan schemes, you can still access finance under this scheme provided you meet all other eligibility criteria.

An important difference to note between this scheme and the earlier Covid loan schemes (BBLS and CBILS) is that the government is no longer funding any of the loan setup fees or interest costs as they did with the previous schemes.


You can apply for a loan if your business:

  • is trading in the UK

You need to show that your business:

  • would be viable were it not for the pandemic
  • has been adversely impacted by the pandemic
  • is not in collective insolvency proceedings (unless your business is in the scope of the Northern Ireland Protocol in which case different eligibility rules may apply)

What finance is available?

The following loans will be available:

  • term loans or overdrafts of between £25,001 and £10 million per business
  • invoice or asset finance of between £1,000 and £10 million per business

No personal guarantees can be taken on facilities up to £250,000, and a borrower’s principal private residence cannot be taken as security.

The duration of loans available to you will depend on the type of finance you apply for:

  • up to 3 years for overdrafts and invoice finance facilities
  • up to 6 years for loans and asset finance facilities

Loans are available through a network of accredited lenders, listed on the British Business Bank’s website. You can find a lender on their website HERE.

This scheme will currently remain open until 31 December 2021, however this is subject to review.

Stuart Hinnigan FCA CTA

Author: Stuart Hinnigan FCA CTA

Stuart’s career in accountancy began when he joined Preston based Moore and Smalley in 1994 following his graduation from Lancaster University. He qualified as a Chartered Accountant in 1997 and then chose to specialise in...

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