Chancellor of the Exchequer Rishi Sunak/HM Treasury
SMEs able to top-up existing Bounce Back Loans under new government initiative
Only if small businesses didn’t claim the maximum £50,000 during the first lockdown.
SMEs that have received cash under the Government-backed Bounce Back Loan scheme (BBLs) will be able to top up funding to protect themselves against the current second national lockdown from today.
Businesses will be able to raise additional funds if they didn’t already borrow the maximum amount, £50,000, in the first round of loans, as part of the UK Chancellor’s updated lending programme as the country enters its second lockdown.
The top-ups will have to come from the borrower’s existing lender and can be worth either up to £50,000 or 25 per cent of the business’ annual turnover that the borrower certified in its first BBLS applications.
So, for instance, if a company borrowed £10,000 in the first wave of loans and has an annual turnover of £200,000, then it is eligible to apply for a £40,000 top-up.
However, if an SME applied for and received £50,000 in the first wave of lending then it is not eligible for a top-up under the new initiative.
The minimum top-up amount under the BBLS top-up programme is £1,000 and the 12-month repayment holiday will only count from the date of the initial loan, not the top-up.
The BBLS scheme has been, by far, the most popular government-backed lending programme on offer throughout the pandemic, with banks and non-bank lenders having dished out £40.2bn to more than 1.3m SMEs.