Bounce back loan scheme launched

Sunak launches bounce back loan scheme for small firms The Chancellor has launched a new loan scheme for Britain’s smallest firms following intense lobbying over fears millions of businesses would never recover from the coronavirus lockdown. The new "Business Bounce Back" loans will be 100% guaranteed by the taxpayer and will provide firms with up to 25% of their turnover up to £50,000 with no interest payable in the first year. Rishi Sunak has come under fire for the Coronavirus Business Interruption Loan Scheme (CBILS) designed for SMEs after businesses complained that lenders were complicating credit decisions. Under CBILS, firms with turnover of up to £50m are allowed to apply for loans of up to £5m with 80% of the debt backed by the government. Small firms applying under the new scheme need to fill out just a “simple, quick, standard form”, Mr Sunak said, while banks will not need to perform any “forward looking tests of businesses viability”. The Bank of England said banks should rely “on judgement in the absence of financial forecast information” when making credit decisions. Banking body UK Finance responded by saying that lenders “will only ask businesses [applying for CBILS-backed lending] for information and data they might reasonably be able to provide at speed.”