There has been considerable commentary in the media about the Coronavirus Business Interruption Loan Scheme. Many business owners – struggling to cope with the reduction in their cash resources due to the COVID-19 outbreak – are finding it difficult to secure support from their bank.
Apparently the banks seem reluctant to lend under the government-backed CBILS scheme. In many cases they are trying to insist that applicant businesses take overdraft or other loans outside the government initiative.
Readers will be encouraged by the Chancellor’s recent comments when he confirmed that personal guarantees should not be requested for loans under £250,000.
The government’s offer to guarantee 80% of loans taken out and cover all the set-up and interest charges for the first year of the loan remains an attractive solution for businesses that need the additional liquidity.
If you are considering an application you will be required to produce certain evidence to back-up your request. This is likely to include:
- Management accounts
- Cash flow forecast
- Business plan
- Historic accounts
- Details of assets
The above requirements will vary from lender to lender.
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