What is the Recovery Loan Scheme?

The Recovery Loan Scheme (RLS) is a Government backed scheme launched on 6 April 2021. The programme is to help UK businesses affected by the Coronavirus Pandemic to recover and access the finance they may require. On 20 July 2022, Business Secretary, Kwasi Kwarteng announced that the Government has extended RLS applications for a further 2 years.

Support your business with Government backed funding

There are many benefits of obtaining a Recovery Loan. Speak to a member of our team to check your eligibility.

The various Government backed loan schemes have now merged into one new offering, the Recovery Loan Scheme

The Recovery Loan Scheme (RLS) provides financial support to businesses across the UK as they recover and grow following the Coronavirus pandemic.  RLS aims to help businesses affected by COVID-19 and can be used for any legitimate business purpose, including managing cashflow, investment and growth. It is designed to appeal to businesses that can afford to take out additional finance for these purposes.

RLS is managed by the British Business Bank.  The lenders of this scheme can be accessed by Independent Business Finance.

Businesses that have taken out a CBILS, CLBILS or BBLS facility are able to access the new scheme, although the amount they have borrowed under an existing scheme may in certain circumstances limit the amount they may borrow under RLS.

Current Scheme Features

• Wide range of products: Businesses are able to choose from a variety of products: Term Loans, Overdrafts, Asset Finance and Invoice Finance facilities.
• Up to £10m facility per business: The maximum value of a facility provided under the scheme is £10m per business. Minimum facility sizes vary, starting at £1,000 for Asset and Invoice Finance, and £25,001 for Term Loans and Overdrafts.
• Turnover limit: There is no turnover restriction for businesses accessing the scheme.
• Term length: Term Loans and Asset Finance facilities are available from three months up to six years. For Overdrafts and Invoice Finance facilities from three months up to three years.
• Pricing: The annual effective rate of interest, upfront fee and other fees cannot be more than 14.99%.
• Interest and fees to be paid by the business from the outset: Businesses are required to meet the costs of interest payments and any fees associated with the RLS facility.
• Personal Guarantees: Personal Guarantees are not permitted for facilities of £250,000 or less. Above £250,000 the maximum amount that can be covered under RLS is capped at a maximum of 20% of the outstanding balance of the RLS facility after the proceeds of business assets have been applied. No personal guarantees can be held over Principal Private Residences.
• Guarantee to the lender to encourage lending: The scheme gives the lender a government-backed guarantee against the outstanding balance of the facility.

As the borrower, you remain 100% liable for the debt.

Who is eligible?

Your business must:

• have been impacted by COVID-19: the borrower 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: the 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.

Credit and fraud checks are required and will be carried out for all applicants.

PLEASE NOTE: Recovery Loan Scheme-backed facilities are provided at the discretion of the lender.

How do I apply for RLS?

Complete our application form and provide details including your name and address, turnover and contact details.

When you apply for finance via RLS, you will need to provide certain evidence to show that you can afford to repay the RLS-backed facility. These requirements vary from lender to lender, but are likely to include the following:

• Management Information
• Last 6 months business Bank Statements
• Latest Year End Accounts
• Details of Business Assets

Decision-making on whether a business is eligible for RLS is fully delegated to the British Business Bank’s accredited RLS lenders.

Independent Business Finance is working with clients wishing to access the Recovery Loan Scheme and all other Business Finance support options.