In terms of size of facility the FAQs for the scheme state that the maximum value of a facility per business is the lesser of:
- Â£10m; or
- double the businesses wage bill for 2019 or last year available
- 25% of the applicantâ€™s turnover in 2019, or
- the applicantâ€™s liquidity needs for the coming 12 months (for large enterprises) or 18 months (for SMEs)
If a business, or any of its linked or partner enterprises (including private equity and venture capital linked enterprises), have borrowed under CBILS or CLBILS then this will count towards a businessâ€™ maximum amount
Your business must:
- have been impacted by Covid-19 â€“ you will need to confirm to the lender that you have been impacted by the coronavirus pandemic
- be carrying out trading activity in the UK
- have a viable business proposition â€“ your lender may disregard (at its discretion) any concerns over short-term to medium-term business performance due to the uncertainty and impact of Covid-19
There is no turnover restriction for businesses accessing the scheme.
To assess (3) above, and specifically to show that you can afford to repay the RLS-backed facility, the British Business Bank state youâ€™ll need to provide certain evidence, and this is likely to include the following:
- Management accounts
- Business plan
- Historic accounts
- Details of assets
Decision-making on whether a business is eligible for RLS is fully delegated to the British Business Bankâ€™s accredited RLS lenders (see further below).
When making their assessment, lenders may overlook concerns over short-to-medium term performance owing to the pandemic. The checks and approach may vary between lenders.
Accredited Lenders and application process
The Recovery Loan Scheme will initially be available throughÂ a number of lendersÂ accredited by the British Business Bank. New lenders under the scheme will be listed on the British Business Bank website as they become accredited.
When looking to borrow, the British Business Bank advise â€œyou should first approach your own finance provider â€“ ideally via its website. You may also consider approaching other lenders if youâ€™re unable to access the finance you need.â€
PKF Francis Clark
We will be modifying the template we used for CBILS for RLS applications and hope to have this available in due course to share with businesses looking to make a RLS application.
We anticipate working with a number of our clients to make applications to this scheme, particularly those with robust growth aspirations but a lack of available security.
We will look to keep this blog up to date with relevant updates about RLS as we find out more through going through the application process with our clients.