Expert View MAKE THE BANK YOUR FIRST PORT OF CALL
by Matt Robinson fund manager, Rosebud
The Recovery Loan Scheme, which succeeded the Bounce Back Loan Scheme and Coronavirus Business Interruption Loan Scheme, is now live.
It has more in common with the Coronavirus Business Interruption Loan Scheme (CBILS) than it does with the Bounce Back scheme, which is probably a good thing.
The most obvious difference is that borrowers are now responsible for the cost of interest and fees from day one.
Otherwise, much is the same, including the fact that the government will continue to
provide an 80 per cent guarantee to lenders and no personal security is required for facilities below £250,000.
They are keen, however, to point out that borrowers are 100 per cent liable for the debt.
Businesses can access multiple schemes, but it may impact how much they can borrow.
Should you require access to the Recovery Loan Scheme (RLS), the first port of call should be your bank.
Facilities are provided at the discretion of the lender and they will need to be satisfied that you have been impacted by Covid-19 and you
have a viable business proposition.
Should your bank say no, then I would recommend visiting the British Business Bank’s website and reviewing the list of accredited lenders.
Alternatively, seek the advice of Access to Finance, a commercial finance broker or speak to your accountant.
If you don’t qualify for the RLS but do have a viable business proposition, there are other active loan funds looking to engage with growing businesses in Lancashire such as our own fund, Rosebud, and the Northern Powerhouse Investment Fund.
“We have so far invested over £35m into Northern businesses through CBILS, and we are still working through applications.
“It is certain the demand for the Recovery Loan Scheme will be just as strong.”
He says: “While CBILS was more about providing funding to support businesses through a very tough trading period, whether it be via loans or working capital, this scheme is about recovery and moving forward.
“Facilities will be geared towards rebuilding, growth, and future investment, rather than maintaining, and funders will potentially have more leverage as a result over which businesses they ultimately support with this scheme.”
He adds: “There is no doubt that businesses in Lancashire have suffered due to the pandemic, some sectors more so than others.
“However, we have seen them demonstrate a resilience, resourcefulness and adaptability which means that many are in a good place to move forward as lockdown conditions continue to ease and the economy reopens”.
Peter Kelly
Peter Kelly, corporate finance director at Lancashire accountants PM+M, points out there are “subtle differences” between CBILS and this latest scheme.
Peter also points out that other funding support is available: “Across Lancashire there are several alternative options open to businesses looking to raise finance,” he explains.
“Worth investigating is the Northern Powerhouse Investment Fund, which is administered by The Growth Company, FW Capital, and Maven
in Lancashire, depending upon the amount required, and whether a business is looking at raising debt or equity.
“There is also the Rosebud Loan Fund which is providing loans up to £300,000 for Lancashire businesses. A good place to start might be Boost Business Lancashire, which can direct business owners to these and other funding that is available.”
Hospitality, retail
and staycation providers should benefit from prompt cash payments
Jamie Grimshaw adds that FW Capital is currently offering funding of £100,000 to £750,000 from The Northern Powerhouse Investment Fund to businesses across Lancashire looking for funding for a variety of purposes.
He adds: “This could include working capital, investment in new staff, the purchase of new machinery or to move premises.”
LANCASHIREBUSINESSVIEW.CO.UK
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FUNDING
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