Coronavirus Business Interruption Loan Scheme (CBILS)

What information do I need to provide for a CBILS application?

You will need to submit a detailed application for the funding you need to the lender. This will vary from lender to lender.

The British Business Bank also advises that you will need to provide certain evidence to show that you can afford to repay the loan. For larger facilities, this may include:

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

The above requirements will also vary from lender to lender. If you do not have access to everything listed above, that does not mean you will be ineligible for a CBILS loan, but it may affect your ability to access finance.

I have been rejected by one of the accredited lenders under the CBILS, can I apply to another?

Yes, you are free to make as many applications as you like. If you were rejected previously by a bank at the start of the crisis it is advised that you consider reapplying as the Government has changed the rules to encourage lenders to support more businesses.

Alternatively, if you are finding it difficult to access finance via CBILS you could consider making an application for up to £50,000 of finance via the Bounce Back Loan Scheme (BBLS).

How soon will the facility requested be available once I make an application?

Due to the volume of requests being made to banks, and the strict controls they have in place, it is taking quite some time to process loan applications and release funds. If you urgently require finance to cover costs within your businesses then you should see what other support is available to you.

Does the CBILS cover overdrafts?

CBILS supports a wide range of business finance products, including overdrafts, as well as term loans, invoice finance and asset finance facilities. The type of finance offered varies by lender, so you should use the British Business Bank’s finance finding tool on its website here.

Do I need to pay interest?

CBILS will be interest-free for the first 12 months, as the Government has guaranteed to cover these payments during this period.

Most facilities are being offered over a six-year period, which means that businesses will have to repay the debts plus interest over the additional five years. However, some banks may extend repayment under the Government’s Winter Economy Plan based on their own discretion.

The Government and the British Business Bank, which is helping to administer the CBILS, have confirmed that no setup fee will be charged.

Do I need to provide a personal guarantee?

The British Business Bank has confirmed that the lender can only require personal guarantees for facilities of £250,000 or more. However, where personal guarantees are required:

  • they exclude the Principal Private Residence (PPR), and
  • recoveries under these are capped at a maximum of 20 per cent of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied
If the scheme is Government-backed, am I liable for all of the debt?

The borrower will remain 100 per cent liable for the debt. An 80 per cent guarantee offered by Government is simply to provide some recourse for the lender in the event of a borrower defaulting on their debt in future.

Rejected applications should not affect your businesses credit rating, but non-payment of an accepted loan will.

The business is a subsidiary in a larger group, can I still apply?

Multiple companies within a group can be considered for the CBILS facility, but the consolidated group must not have a combined turnover in excess of the £45 million annual threshold.

Our turnover is too high for this scheme, are there alternative schemes available to larger businesses?

The Coronavirus Large Business Interruption Loan Scheme (CLBILS) is aimed at large businesses with annual turnovers above £45 million.

Like CBILS, a Government guarantee of 80 per cent will be provided to enable banks to lend in circumstances where they might not otherwise be able to.

Unlike CBILS, which only provides loans of up to £5 million, CLBILS will provide loans of up to £25 million.

However, while CBILS provides loans that are interest-free for 12 months, CLBILS loans will be provided at normal commercial rates of interest.

When does the scheme end?

Applications were originally due to end in October, but have been extended until the end of November.