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    CBILS Loans

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    AFP CBILS Loans

    What is the Coronavirus Business Interruption Loan Scheme (CBILS)?

    CBILS is a new scheme that can provide facilities of up to £5 million for smaller businesses across the UK that are experiencing lost or deferred revenues, leading to disruptions to their cash flow. CBILS supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance facilities.

    Note: This scheme is just one of a number of measures announced by Government. You can find full details of the temporary, timely and targeted measures to support public services, people and businesses through this period of disruption caused by coronavirus here.

    More on CBILS

    What are the new changes to CBILS?

    CBILS has been significantly expanded along with changes to the scheme’s features and eligibility criteria. The changes mean even more smaller businesses across the UK impacted by the coronavirus crisis can access the funding they need. Insufficient security is no longer a condition to access the scheme.

    Importantly, access to the scheme has been opened up to those smaller businesses that would have previously met the requirements for a commercial facility but would not have been eligible for CBILS. This significantly increases the number of businesses eligible for the scheme. The expanded scheme will be offered by lenders from Friday 3 April 2020 and operational from Monday 6 April 2020.

    Important note: We have communicated that these changes should be retrospectively applied by lenders for any CBILS facilities offered since 23 March 2020. For any commercial (non-CBILS) facilities offered since the same date, providing the borrower meets the CBILS eligibility, lenders have been asked to bring these facilities onto CBILS wherever possible (e.g. where the lender is accredited to offer the same facility through CBILS) and changes retrospectively applied as necessary.

    When can I access the scheme?

    The scheme went live on Monday 23 March and will initially run for six months. The expanded scheme will be offered by lenders from Friday 3 April 2020 and operational from Monday 6 April 2020.

    Key Features

    What are the key features of CBILS?

    CBILS guarantees facilities up to a maximum of £5 million, available on repayment terms up to six years (for term loans and asset finance) and up to three years (for overdrafts and invoice finance facilities).

    The scheme provides the lender with a government-backed guarantee against the outstanding balance of the facility.

    There is no guarantee fee for SMEs to access the scheme. The Government will make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees.[5] You (the SME) will therefore benefit from no upfront costs and lower initial repayments.[6]

    [5] Following earlier discussions with the banking industry, some lenders indicated that they would not charge arrangement fees or early repayment charges to SMEs borrowing under the scheme. HM Government greatly appreciates this approach by lenders.

    [6] Fishery, aquaculture and agriculture businesses may not qualify for the full interest and fee payment.

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