What are the Coronavirus Supports for Business in the UK?
A series of financial assistance programs have been launched by the British government for businesses in light of the pandemic. Coronavirus support for businesses are provided by the HM Revenue and Customs (HMRC) and partner banks of the government.
While the UK is trying to reignite the key economic activities to foster growth, businesses are availing of the grants from HMRC to keep their operations running amid the crisis.
Since last April, the UK government has been providing financial schemes and tax deferrals to help businesses in paying their employees and taxes. Here is an updated list of HMRC business support.
Financial Support for Small and Medium-sized Businesses
Coronavirus Business Interruption Loan Scheme
- A £5 million grant is given to small and medium-sized businesses to avail loans and other financial needs through the British Business Bank.
- The government guarantees 80% of the finance to the lender and pays interest and any fees for the first 12 months.
- Firms with an annual turnover of £45 million and generate more than 50% of its turnover from trading are eligible for the scheme
Coronavirus Future Fund
- The Future Fund is available for UK-based innovative companies which rely on equity investment and are not eligible for government support for small business because they are either pre-revenue or pre-profit.
- This scheme provides £125,000 to £5 million loans, subject to at least equal match funding from private investors
- Application is until the end of September 2020.
Coronavirus Bounce Back Loan
- This is a quicker finance access for smaller businesses during the pandemic.
- Loans amounting from £2,000 to £50,000 will be available for lending.
- The loan will be interest-free for the first 12 months. For the succeeding months, a 2.5% interest rate will be charged per year.
Financial Support for Large Businesses
COVID-19 Corporate Financing Facility (CCFF)
- Under the CCFF, commercial lenders, backed by the Bank of England, will buy short-term debt from large companies
- The CCFF will be a credit easing scheme targeted at addressing the disruption to cash flows of companies resulting from Covid-19.
- The scheme will last for 12 months, or until the government sees a cash flow disruption in major firms that majorly contribute to the UK economy.
Coronavirus Large Business Interruption Loan Scheme (CLBILS)
- CLBILS is focused in providing larger businesses loans and finances amounting to £200 million.
- The government guarantees 80% of the finance to the lender.
- Firms with an annual turnover of £45 million are eligible for the loan.
You can find more details about the UK’s Coronavirus support for business at the HMRC website.
As the UK economy navigates around the situation, the government is doing its utmost effort to provide financial assistance to the firms that fuel their economic growth. Their series of schemes are also aimed at helping the people to survive the crisis.
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