Since the coronavirus (COVID-19) support scheme was launched last May, more than 1.5 million Bounce Back loans have been taken out. According to the Treasury, borrowing by businesses is now over £46 billion.
The Coronavirus Recovery Loan Scheme is set to replace the existing loan structure in April, although details on how to apply have still not been released. The Treasury has confirmed that applications will be open from 6 April.
Aiming to ensure viable businesses can access government-backed finance throughout 2021 following the disruption caused by the pandemic, The Recovery Loan Scheme will run until 31 December 2021.
The Treasury’s final monthly update on its emergency loan schemes – the Bounce Back Loan Scheme (BBLS), Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Coronavirus Business Interruption Loan Scheme (CBILS) – shows that more than 1.6 million firms benefited from support to keep them trading.
In total, over 98,000 companies borrowed £23.3 billion through the CBILS, while 716 firms borrowed a further £5.3 billion through the CLBILS.
Craig Beaumont, Chief of External Affairs at the Federation of Small Businesses (FSB), said: ‘1.6 million small businesses have now been helped to keep going through an awful year by securing Bounce Back loans. As the unlock takes place, the economic recovery will rely on the successor scheme to fire on all cylinders.’
‘While in the short term, these bounce back loans have allowed businesses to survive the pandemic, it is unlikely that many of these businesses will have the funds to repay these loans without having to pay interest on them, if ever.’Nigel Holland