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New changes to the government-backed Coronavirus Business Interruption Loan Scheme (CBILS) means that more small and medium-sized businesses are able to access funding. Under previous EU state aid rules, companies classed as having “undertakings in difficulty” were barred from borrowing through the scheme, however this has now been adjusted. Now companies that employ less than 50 people and turnover less than £9 million a year are eligible and can access loans of up to £5million. The new rules will come into force today (30th July).
To date, around 57,000 businesses have drawn on the CBILS scheme.
The economic secretary to the Treasury, John Glen, and small business minister Paul Scully have written to accredited lenders with the expectation that these changes will be implemented.
John Glen commented, “Our loan schemes have been a key part in supporting businesses enabling them to bounce back as we kick start the economy. I’m delighted that our work with the Commission has paid off so we can further support the smallest businesses.”
Paul Scully said, “We have stood by business throughout this crisis, and today’s announcement will mean that even more small firms will be able to access much-needed financial support. Small businesses will play a vital role as we seek to recover our way of life and get the economy moving again, and it is essential we continue to support them through this difficult period.”
Michael Moore, director general at BVCA, welcomes the news. He said, “The BVCA welcomes the changes announced today as these will benefit many small businesses nationwide backed by private equity and venture capital. These businesses have strong growth prospects and it is right that the undertaking in difficulty definition was amended to take account of their value to the economy.”
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