Covid-19 update: Easy access 'bounce back' loans available from Monday

Covid-19 update: Easy access 'bounce back' loans available from Monday

A new microloan scheme for the self-employed, small businesses and sole traders was unveiled yesterday by the UK government.

The scheme promises fast funds to help businesses stay on their feet while we collectively tackle the coronavirus outbreak.

This could be great news for companies struggling to make it through to the June support payment, those that missed out on support altogether or are struggling to access credit to stay afloat. It's particularly welcome for Limited Companies.

How do you apply?

How can they promise the money so quickly?

Banks are not having to bear the risk of any losses (the government is guaranteeing the loans), so you won't be subject to time-consuming and invasive credit checks. That doesn't mean you're guaranteed to be accepted, but it does mean there's a lot less red tape.

Will you pay interest?

The loan terms mean that no capital or interest repayments will be due for one year. Instead, the government will pay the interest for the first 12 months.

After that, interest rates will be "very low", according to the Treasury. Repayment time frames will be around five years.

Our view: The Amaiz Accountancy Team  

"For sole traders, small businesses and limited companies in particular, this could be a total lifesaver - just when it was looking like help wasn't coming. You now have a simple route to fast finance. However it is a loan, so you must be able to pay it back in the years ahead."

If you have an Amaiz Advanced account, you'll know you can ask our Accountancy Expert team a general question about Self Assessment tax and bookkeeping at any time in the app.

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