The Chancellor Rishi Sunak announced at the weekend a number of changes to Bounce Back Loans, aimed at providing additional financial support and stability for business after the pandemic.
Currently, a Bounce Back Loan is for a six-year period, with no payments required within the first 12 months.
Following Sunak’s announcement, before the first repayment is due, your lender will contact you about further options to extend the term of the loan, move to interest-only payments or pause your payments.
The move is said to benefit businesses struggling to cover costs, as the initial payment nears its first due date in May.
The new terms mean companies have three options:
- extend the term of your loan to 10 years
- move to interest-only repayments for a period of 6 months (you can use this option up to 3 times)
- pause your repayments for a period of 6 months (you can use this option once)
Companies can still apply for a Bounce Back Loan, however the closing date is March 31, 2021.