CBILS - What is The Coronavirus Business Interruption Loan Scheme? Skip to content

What is The Coronavirus Business Interruption Loan Scheme?

What is The Coronavirus Business Interruption Loan Scheme?

Every company in the UK has been affected by the Coronavirus and at the end of March 2020 the Government announced the Coronavirus Business Interruption Loan Scheme (CBILS). Through the CBILS businesses could access up to £5 million through loans and other financial schemes. 

Is your business eligible? 

To receive the loan your business must: 

  • Be UK based with turnover not exceeding £45 million per annum
  • Have been adversely impacted by coronavirus 
  • not have been classed as a ‘business in difficulty’ on 31 December 2019, if applying to borrow £30,000 or more
  • Have a sound borrowing proposal 

Those not eligible for the loan include: Banks, Insurers and Reinsurers (but not insurance brokers); public sector bodies, further educational establishments if they are grant funded and state funded primary and secondary schools.

There are currently over 40 lenders who are participating in the CBILS. Before going on the hunt you can contact your current bank. Most providers will have their schemes laid out on their respective websites.

What information do you need? 

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You will need to tell the lender how much money you are planning to apply for, and why you need the money. If you are applying for a smaller amount the information you need to provide may not be this extensive. However the guideline suggest your lender may ask for supporting documents such as: 

  • Management accounts
  • Cash flow forecast
  • Business plan
  • Historic accounts
  • Details of assets

You are more likely to succeed with your application if you provide all the information requested and have the ability to prove your worth if it wasn’t for coronavirus affecting your business. 

What happens next? 

After your application is put forwards your lender will come back with their decision. Since it’s implementation loans currently acceptance rate is an average of 53,000 per day. So far, lenders have received 62,674 completed CBILS applications for small and medium-sized enterprises. 

If your application is unsuccessful, the government have also implemented a number of schemes which you may be eligible to apply for.

These include: 

  • A statutory sick pay relief package for SMEs
  • A 12-month business rates holiday for all retail, hospitality and leisure businesses in England
  • Small business grant funding of £10,000 for all businesses in receipt of small business rate relief or rural rate relief; and
  • Grant funding of £25,000 for retail, hospitality and leisure businesses with property with a rateable value between £15,000 and £51,000

Alternatively, you can use the Bounce Back Loan system which is designed to enable smaller businesses to access finance more quickly during the coronavirus outbreak.

While the government can guarantee 80 per cent of the loan, your business is still 100 percent liable for all of the loan repayments. This means you should be sure that you can repay the debt in the future.

This article is by no means financial advice and you should discuss your finances with an independent trained professional if ever in doubt on how to proceed. 

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Dean Seddon

Dean Seddon

I've worked with some amazing companies from start ups to multi-nationals. I've also guest lectured at Universities in the UK. I'm the maverick that helps business solve their No 1 problem; How to convince more customers to buy.
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