Government Recovery Loan Scheme Ending 30th June
To help businesses recover from Covid-19 restrictions, the UK government introduced a Recovery Loan Scheme (RLS), providing SMEs with better access to finance. Subject to certain eligibility criteria, the loan can then be used for any legitimate business purpose.
The RLS scheme is coming to an end on 30th June. All loan applications must have been submitted before close of office hours on this day. If you expect to need funding this year or next to cover operational costs or to invest for growth, you must contact us immediately, so that we can process your application in time.
Key benefits of the Recovery Loan Scheme
- Borrow up to £250k with no personal guarantee
- Finance from £25,001 to £500,000
- Accelerate investment plans
- Fixed rate; avoid rising interest rates
- Government guarantee 70% of agreed finance for lenders
- Use the funding for any legitimate business purpose
- No early settlement fees
- Repayment terms up to 5 years
How much can I borrow on the Recovery Loan Scheme?
Portman can secure funding from £25,001 to £500k, with no personal guarantee required up to £250k, meaning a borrower’s primary personal residence is not at risk.
The government guarantees 70% of the loan to the lender, not the borrower, who is still liable for 100% of the debt.
The loan rate itself is capped but is individual to your business, based on factors including your credit score and trading performance.
Is a Recovery Loan right for everyone?
Recovery Loans are a good option if you have been affected by the Covid-19 pandemic and its restrictions. However, suitability is based on individual needs and circumstances. If we can find a better deal for you, then we will offer you alternative finance options as well.
Who is eligible for the Recovery Loan Scheme?
Portman is able to act as a broker and, subject to credit status, can consider arranging loans for businesses who meet the following criteria:
- Trading in the UK for at least 2 years
- Minimum of 1 year’s filed financial accounts
- Turnover from £200k up to £45m
- A limited company or LLP
- One of the directors/shareholders is a homeowner
- Have been impacted by Covid restrictions
- Need a loan for a legitimate business purpose
Public sector bodies, public schools, banks, lenders and insurers are excluded but all other types of business can apply.
Businesses who have already received funding under the Coronavirus Business Interruption Loan Scheme, (CBILS) or the Bounce Back Loan Scheme (BBLS) are eligible to apply.
Businesses can borrow up to £250,000 with no personal guarantee. Any investment plans that require funding can be accelerated using a finance product that protects their personal wealth. Interest rates are rising, securing a fixed rate loan now provides access to finance that is likely to be more expensive in the future. Repayment periods can be up to 5 years, meaning the investment can generate income over the term. The loan can be used for any legitimate business purpose including: equipment, vehicles, cashflow, stock, refurbishments, technology and marketing.
The Recovery Loan Scheme was launched on 6th April 2021 and will be closed to further applications from midnight on 30th June 2022.
The eligibility requirements for a Recovery Loan are: a minimum 2 years trading history, at least 1 year’s filed financial accounts, a minimum £200k turnover, a limited company or LLP, at least one of the directors or shareholders is a homeowner, UK-based in its business activity and adversely impacted by Covid-19. Complete our enquiry form with a few basic details and one of our Account Managers will call you back to discuss your needs. We will ask you to provide some business documentation, then Portman will complete and submit applications on your behalf.
A personal guarantee (or director guarantee) is an individual’s commitment to pay a debt personally if the business cannot. Typically, a business owner or director, will act as guarantor for a loan, whereby they will become liable for a debt if the business can no longer pay. The personal guarantee reduces the risk for a lender.
In the case of Recovery Loans, no personal guarantee is required up to a loan value of £250,000. This means that the business owner or director cannot be held personally liable, should the business default on the loan. Instead, the UK Government is guaranteeing 70% of the loan value to the lender.
Excellent communication and help throughout the process. Easy and prompt emails. Highly…Daniel Cooper
Portman and the entire team are great to work with, know their lenders and products incredibly…Marney Howe
Very smooth operation
I have now dealt few times with Portman Finance and it has always been very smooth and…Anthony ienco
We used Portman Finance to secure finance for a new restaurant we are opening. Jack Weston…David B