Information about the Bounce Back Loan, Pay As You Grow facility is now available. This impacts UK smaller businesses that have taken out a Covid-19 Bounce Back Loan to help manage their cashflow as a result of the pandemic. Businesses first began to receive Bounce Back Loans in May 2020 and the first repayments will be due from May 2021 onwards.
Since May 2020, the scheme has supported nearly £45bn of loans to 1.5m businesses. Businesses can apply for a loan from £2,000 up to 25% of their business’ turnover, with a fixed interest rate of 2.5% for the duration of the loan, meaning all borrowers benefit from the same, affordable rate of interest. The maximum loan amount is £50,000, and the Government will make a Business Interruption Payment (BIP) to cover the first 12 months of interest payments. The borrower does not have to make any repayments for the first 12 months.