Clarkslegal LLP - Solicitors in Reading and London

Legal Updates

The Government’s Bounce Back Loan Scheme

29 April 2020 #Employment #Podcasts and Webinars


At the beginning of this week, the chancellor announced a new scheme aimed at helping small to medium sized businesses to borrow between £2,000 and £50,000.

The government states that it will guarantee 100% of the loan (unlike under the Coronavirus Business interruption Loan Scheme which is only 80% state-backed), there will be no repayments due in the first 12 months and the loan terms can be up to 6 years. Although not yet available, as it launches on Monday 4th May, this will come as very reassuring news for thousands of small firms who are in dyer need of a cash injection.

In order to be eligible for the scheme, your business must:

  • Be based in the UK
  • Been negatively impacted by COVID-19
  • Not have been in an “undertaking in difficulty” on 31 December 2019; and
  • Not already claiming under the Government’s Coronavirus Business Interruption Loan Scheme.

A business is an “undertaking in difficulty” when deduction of accumulated losses from reserves (and all other elements generally considered as part of the own funds of the company) leads to a negative cumulative amount that exceeds half of the subscribed share capital.

We can expect further guidance on this new scheme in the next few days. Some commentators have been quick to suggested that, on a practical level, the new scheme will require significant changes to the Consumer Credit Act, however, no changes have been announced yet.

 

Clarkslegal, specialist Employment lawyers in London, Reading and throughout the Thames Valley.
For further information about this or any other Employment matter please contact Clarkslegal's employment team by email at employmentunit@clarkslegal.com by telephone 020 7539 8000 (London office), 0118 958 5321 (Reading office) or by completing the form on this page.
Disclaimer
This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full General Notices on our website.

Read more articles

Jacob Montague

Jacob Montague
Trainee Solicitor

E: jmontague@clarkslegal.com
T: 0118 960 4613
M: 0790 9964 585

Contact

Employment team
+44 (0)118 958 5321