Get in touch
TVAF 7 West Mills Yard, Newbury, Berkshire, RG14 5LP
Having been extended three times throughout the pandemic, the CBIL scheme finally ended on 31 March 2021 and the Recovery Loan Scheme was announced as the replacement in the Spring 2021 budget. The TVAF team sees this as excellent news because so many businesses are struggling due to long periods of closure or having to invest in new ways of working to ensure they can open their businesses safely.
Although the scheme is relatively new and we are receiving more information about the scheme on a daily basis, we thought it would be useful to summarise what we do know, so that you can start your financial planning as the economy starts the long road to recovery.
Compared to the previous CBIL scheme, the Recovery Loan Scheme has wider inclusion criteria, which means that financial support is available for businesses who don’t have three years’ trading history. This is excellent news for start ups and very new businesses, who previously weren’t eligible for help.
The main difference is that the arrangement fees and interest will need to be paid back from the day you take out the loan. There is no 12 month period without any repayments due, as was the case with the CBIL scheme. If you apply for funding through the Recovery Loan Scheme, you will need to pay interest and arrangement fees from month one.
The eligibility criteria seems to be fairly wide and open to interpretation, so only time will tell what that means for businesses. The fact that many businesses have gone through significant periods without being able to access any financial help is potentially a factor here, but until we put applications through, it’s quite hard to know who will qualify and who won’t.
Many lenders are still processing their CBIL applications so are slightly behind on their applications for the Recovery Loan Scheme, which is arranged through the British Business Bank. All lenders signing up to the Recover Loan Scheme must be accredited by the British Business Bank and are likely to include traditional high street banks, asset finance/equipment finance companies and Fintech loan providers.
The good news is that some of the asset finance lenders that TVAF works with are already accredited under the scheme, with we suspect more to follow. We will keep you updated, but wanted you to know a bit more about the help that is available for you and how you can access it.
Once the lenders we work with are approved, we are very quickly making sure our own accreditation with each lender is approved, so that we are ready to quickly help clients who need loans and asset or equipment finance for their businesses. We are already approved under the Aldermore Bank and Paragon Bank schemes for asset and equipment finance and this has been a quick and easy process. We expect to have wider access to a range of Recovery Loan Schemes available for our clients in the coming weeks and months.
It’s worth noting that each accredited lender will have their own Recovery Loan Scheme qualifying criteria, so whilst TVAF as a broker has access to a substantial panel of lenders, we won’t be working with all those that are participating in the scheme. Our focus is to work with lenders that have been individually accredited for equipment finance and business loans.
If you think your business has a requirement to borrow money to finance additional equipment or machinery purchases or you want to raise extra working capital, help could be available in the form of the Recovery Loan Scheme. We would advise you to get the ball rolling as soon as possible because more lenders are signing up to the scheme on a daily and weekly basis, so get in touch with the TVAF team so that we can get things moving for you.
If you want more information, the British Business Bank have published some FAQs here.
You might want to look at using the Recovery Loan Scheme to inject some cash into your business if you are seeing opportunities to grow as we exit the lockdowns the pandemic has caused. Or, you might want some investment into your business to help you replace older plant and machinery. The Recovery Loan Scheme might be a very cost-effective way to access the money needed to purchase that new equipment.
Recovery Loan Schemes are available for Asset Finance purchases such as trucks, trailers, equipment or vans. The scheme also offers standard loans too, which you could use to expand your premises, hire new staff or invest in marketing services.
We have already successfully helped a number of companies to secure additional funding through the CBIL Scheme.
A newly established sports club in Berkshire applied for financial support through the CBIL scheme because they had remained closed for much of the last 12 months and needed to cover their fixed costs, such as heating, water and rates.
A fast-growing printing company needed to invest in new capital assets to meet growing demand because of the pandemic.
The Recovery Loan Scheme isn’t just to help businesses who have struggled through the pandemic. You might see an opportunity to grow and expand your business as a result of changes brought about by this new world!