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First lenders announced for new Recovery Loan Scheme

The first batch of lenders accredited to take part in the latest version of the Recovery Loan Scheme (RLS) has been announced.

Details of the updated version of the RLS were published early this month and the scheme will run for a further two years.

The British Business Bank will continue to administer the scheme on behalf of the Secretary of State for the Department for Business, Energy & Industrial Strategy (BEIS).

Support for two years

Bank of Scotland, Coventry & Warwickshire Reinvestment Trust (CWRT), Lloyds Bank, NatWest and Royal Bank of Scotland now accredited to deliver the scheme

Businesses can use the finance for any legitimate business purpose – including managing cashflow, investment and growth., but must be able to afford to take out additional debt finance for these purposes.

Are you eligible for the scheme?

Maximum loan remains at £2 million

Previously the RLS had provided £4.5 billion of finance to smaller businesses between April 2021 and 30 June 2022. One change is that for most borrowers there is no requirement to confirm they have been affected by COVID-19.

The maximum loan remains at £2 million and £1 million within the parameters of the Northern Ireland Protocol.

The RLS provides much-needed guarantees for SME lending, with the Government underwriting 70 per cent of what the lender could lose if a business defaults.

The scheme allows discretion in lending

The scheme aims to improve the terms on offer to borrowers. It is designed to be used at the discretion of the lender where appropriate. If a lender can offer a commercial loan on better terms, they will do so.

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