COVID-19: Cash assistance for businesses

COVID-19 is causing economic uncertainty across all areas of business. To sustain the economy, the Government has set out a number of temporary and targeted packages designed to support businesses through this period of disruption.

Due to the changing landscape, the full details of these packages are not yet known. We will be updating the information on our website as and when updates are provided, so please check this page regularly for the most up-to-date information.

Small Company Grant Scheme (Scotland)

The Scottish Government has introduced extra rates relief and one-off grants for small businesses, more specifically:

  • all non-domestic properties in Scotland will get a 1.6% rates relief
  • retail, hospitality and leisure businesses will get 100% rates relief and will be able to apply for a one-off grant of £25,000 (only eligible for businesses with a rateable value between £18,000 and, up to and including, £51,000)
  • a one-off grant of £10,000 will also be available to small businesses who get (i) small business bonus scheme relief, or (ii) rural relief

The Scottish Government is currently working with Scotland’s 32 Councils to agree a streamlined and effective approach to the application process and we will update this note with more information as soon as we know more.

Coronavirus Business Interruption Loan Scheme (CBILS)

On 23 March, the Coronavirus Interruption Business Loan Scheme (CIBLS) was launched to provide facilities of up to £5m for smaller businesses across the UK. The Government will also make a Business Interruption Payment to cover the first 12 months of interest payments and any lender-levied fees, so smaller businesses will benefit from no upfront costs and lower initial repayments.

Products

The scheme will support a range of business finance products including term facilities, overdrafts, invoice finance facilities and asset finance facilities.

Eligibility

To qualify business must:

  • be UK-based (with turnover no more than £45 million per annum)
  • the application must be for business purpose and the facility must be used primarily to support trading in the UK
  • generate more than 50% of its turnover from trading activity
  • have a borrowing proposal which, in the absence of the COVID-19 pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable your business to trade out of any short- to medium-term difficulty

Only a small number of sectors including banks, building societies, insurers (but not insurance brokers), public sector, religious or political membership organisations or trade unions are excluded.

How to apply

CBILS is available through 40+ accredited lenders and partners which are listed here.

Businesses that meet the eligibility criteria, and are looking to access the scheme, should approach one of the accredited lenders. Decisions on whether a business is eligible is fully delegated to the 40+ accredited specialists, so if you are unable to access the finance you need with one lender, you should consider approaching other lenders. Further information can be found on the British Business Bank website.

Corporate Financing Facility (CCFF)

The CCFF was launched on 23 March to support companies that are fundamentally strong but have been affected by a short term funding squeeze, to enable them to continue financing their short-term liabilities. The Bank of England will operate this facility which will purchase commercial paper (short-term debt) of up to one year maturity.

Eligibility

To qualify businesses must:

  • make a material contribution to the UK economy (i.e. UK incorporated, significant employment in the UK, headquarters in the UK or significant revenues in the UK)
  • demonstrate that they were in sound financial health prior to the pandemic
  • prior to COVID-19, have had a minimum short term credit rating from one of the Big Three credit rating agencies or, if a short-term credit rating is unavailable, a long-term rating may be used to assess credibility

Offers to sell will require to be submitted by phone to the Bank’s Sterling dealing desk between 10am and 11am. The minimum size of any individual security that the fund will purchase is a nominal value of £1 million and offers are required to be rounded to the closest £0.1million.

How to Apply

Businesses should initially discuss the scheme with their own bank to determine whether their bank issues commercial paper (as not all banks do!). If your bank does not issue commercial paper, UK Finance has provided a list of those banks that do.

If, after speaking with your bank, you believe your business is eligible then you will be required to complete a number of forms located here and submit these to the Bank of England. If you are still unsure, having discussed matters with your bank, of your eligibility you should contact the Bank of England directly on CCFFeligibleissuers@bankofengland.co.uk

Coronavirus Job Retention Scheme

The new Coronavirus Job Retention Scheme is designed to help employers retain staff where there is currently no work and those employees would otherwise be made redundant or laid off temporarily without pay. Under the Coronavirus Job Retention Scheme, the UK government will reimburse 80% of an employee’s salary up to a maximum of £2,500.00 per month.

For more detailed information on how the Scheme works, please see our Employment team's recent article.

Contact our team

Our Corporate Finance and Banking & Finance teams are on hand to provide advice and assistance, so please do not hesitate to contact us if you have any questions about your business's particular circumstances.

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