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RECOVERY LOAN SCHEME DEADLINE DAY’S LOOMING
13 April 2022
30th june 2022.
That’s months away, right?!
Whilst it may seem a distant date right now, it’ll creep up fast.
This important deadline day’s when qualifying businesses who’ve been impacted by the pandemic will need to have their Recovery Loan Scheme (RLS) applications submitted and approved by the lender.
Applications should be submitted by the middle of June at the very latest.
What’s the recovery loan scheme (RLS)?
RLS was the scheme set up by the government as a follow on from the Coronavirus Business Interruption Loan Scheme (CBILS) to help businesses impacted by Covid-19 and is likely to be the last of its kind. So, if you’re needing to get a handle on cashflow, or take your business forward, now’s the time to get your application in.
Do you qualify?
If your SME business (less than 250 employees/turnover less than 50m Euros) has been affected by the pandemic, you qualify. You’ll need to apply for the loan, clearly demonstrating your viability, and have lender approval by 30th June 2022.
It’s worth noting you’ll still qualify if you have a Bounce Back Loan (BBL) or CBILS. Whilst the amount you can borrow may be limited in this case, we can help you explore a number of refinancing options at a lower interest rate.
The ‘High Street’ banks have been told to apply ‘normal lending criteria’ to the approval process, so you may have more success with one of the specialist lenders. We can help you find one.
What can you use the funds for?
RLS funds (a loan amount of up to £2m per business) can be used for a variety of legitimate business purposes for example; working capital, investment, growth.
What else should you know about the RLS?
• There are no personal guarantees required for a recovery loan up to £250,000 and the borrower’s home can’t be taken as security.
• The government guarantee is 70% of the amount borrowed. This is less than the CBILS and BBL schemes.
• Repayment terms are up to 3 years for overdrafts and 6 years for loans.
Here’s an example…
Let’s say you own a company in the hospitality or travel sector that’s made losses in the last couple of years but is now showing and forecasting profits from an upturn. You’ll now need funding to help the working capital needs of your business. With recent losses, and a lack of security, this’ll probably fail to be approved by conventional bankers. The solution? RLS.
Don’t miss the deadline and an opportunity to take your business forward. Let us take away some of the pressure by helping with your loan applications.
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