The Recovery Loan Scheme - the facts

Blogs 28 Jun 2021

Finance experts from FSB Funding Platform answer your frequently asked questions about how the Recovery Loan Scheme works, what’s involved, and how they’ve made the application process easier for FSB members.

Applications for the Recovery Loan Scheme (RLS) remain open as part of the Government’s plan to support UK businesses as they recover and grow following the coronavirus pandemic. The scheme aims to give small businesses affected by COVID-19 financial support of between £1,000 and £10 million for any legitimate business purpose, such as cash flow, investment, and growth.  

The British Business Bank has stated that a key aim of the Recovery Loan Scheme is to improve the terms on offer to you. If a lender can offer you the choice of a commercial loan on better terms, without requiring the guarantee provided by the RLS, they should do so.

How do I access the Recovery Loan Scheme? 

FSB Funding Platform is providing FSB members with an easy way to access multiple providers for the Recovery Loan Scheme (RLS) by completing an application online here.  

As an FSB member, you can register through FSB Funding Platform and make one simple application, saving you time and effort. FSB Funding Platform then do the hard work for you by checking your eligibility with our current list of providers. Not all providers are available through the Funding Platform now, but more are being added.  

FSB Funding Platform’s finance advisers are also on hand to answer any questions you may have about the scheme and can offer you help within 48 hours, based on a combination of intelligent technology and excellent customer service. The team can also use your application to suggest other funding options available to you. 

When is the deadline? 

You have until 31 December 2021 to apply for the Recovery Loan Scheme, subject to review.  

Is my business eligible? 

Your business does not automatically qualify for funding. The eligibility criteria will vary for each lender, and as such, each lender has the authority to decide whether to offer finance to your business or not. Decision-making on whether a business is eligible for RLS is fully delegated to the British Business Bank’s accredited RLS lenders

Access to the Recovery Loan Scheme has now opened further and you may therefore consider re-contacting your lender if you have previously been unsuccessful in securing funding.  

I applied for a Bounce Back Loan Scheme (BBLS) or Coronavirus Business Interruption Loan Scheme (CBILS). Can I still apply for the Recovery Loan Scheme? 

Yes, the Recovery Loan Scheme is still an option for your business but note that the circumstances limit the amount you may borrow under RLS.  

How much can I borrow and what does it cover? 

The Recovery Loan Scheme covers Term Loans, Asset Finance, Invoice Finance and Revolving Credit (Overdrafts) from £1,000 up to £10 million. Finance terms are up to six years for Term Loans and Asset Finance facilities. Lenders have agreed they will not take personal guarantees as security for lending below £250,000. 

If you have been offered finance and are unsure about the terms, you can request a call back from the team at FSB Funding Platform, who are always happy to try and help you review your options as an FSB member. 

How much interest will I have to pay? 

Interest and fees to be paid by the business from the outset: 

  • Fees associated with the RLS facility
  • The annual effective rate of interest, upfront fee, and other fees cannot be more than 14.99% 

What information will lenders need from me? 

You should expect to provide information to lenders about your funding requirements, as well as supporting documentation. This may include: 

Funding requirements 

  • The amount you are seeking 
  • What the funding will be used for — the lender is obliged to check that their finance product suits your business needs 
  • Your preferred repayment period — this is important because lenders need to assess whether your business can afford the loan 

Supporting documents 

  • Management accounts 
  • Business plan 
  • Historic accounts 
  • Details of assets 

The above list will vary for each lender, but you will need to provide evidence to show that your business can afford to repay the amount you are borrowing plus interest. FSB members who use FSB Funding Platform can take advantage of Open Banking and accounting software integrations to help prepare their finance application in minutes. 

Find out more about FSB Funding Platform or start your application today


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