Bounce Back Loan Scheme (BBLS) – your FAQs answered

4th May 2020

The information on this page is updated where possible and is based on the British Business Bank's guidance.

The Bounce Back Loan Scheme (BBLS) has launched today (Monday 4 May) and is a new scheme for businesses in the UK that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak. 

It has been introduced to help smaller businesses and allows them to access finance ranging from £2,000 to 25% of a business’ turnover or £50,000, whichever is lower.

The BBLS is available through accredited lenders and approved partners of The British Business Bank and can be applied for on the respective lender’s or partner’s website. 

Sorting finances

What are the key terms of the BBLS? 

  • Loans of £2,000 to £50,000 or 25% of 2019 turnover - whichever is lower.

  • Available to UK trading businesses affected by COVID-19 

  • 100% government-backed guarantee - no personal guarantees will be required 

  • Loan terms of 6 years with no capital or interest payments required in the first year 

  • A fixed interest rate of 2.5% 

  • Simple online application form, with funds available within 24-48 hours 

  • All major high-street banks are able to lend under the scheme. A full list of accredited lenders can be found here  

  • Can apply for a loan under BBLS or CBILS but not both 

Am I eligible? 

The scheme is open to most businesses, regardless of turnover, who meet the eligibility criteria and who were established on or before 1 March 2020.  

Borrowers are required to declare, amongst other things, that: 

  • The business is engaged in trading or commercial activity in the UK at the date of the application, was carrying on business on 1 March 2020 and has been adversely affected by COVID-19.

  • The business (and any wider group of which it is part) has not already received a Bounce Back Loan Scheme facility. 

  • The business (and any wider group of which it is part) has not yet obtained a loan through either the Coronavirus Business Interruption Loan Scheme (CBILS) unless that loan will be refinanced in full by the Bounce Back Loan Scheme facility. 

  • That the business is a UK limited company or partnership, or tax resident in the UK 

  • The business is not a bank, building society, insurance company, public sector organisation, state-funded primary or secondary school, or an individual other than a sole trader or a partner acting on behalf of a partnership. 

  • That the business was not, on 31 December 2019, a “business in difficulty” [** see details below].  

  • At the time of submitting their loan application, the business is neither in bankruptcy, debt restructuring proceedings, liquidation, or similar. 

  • More than 50% of the income of the business (together with that of any member of any group of which it is a part) is derived from its trading activity. This confirmation is not required if the borrower is a charity or a further education college. 

  • They will use the loan only to provide economic benefit to the business, and not for personal purposes. They have understood the costs associated with repayment of the loan and that they are able and intend to complete timely repayments in the future. 

How do I apply? [Updated 03.06.2020]

The BBLS is available through accredited lenders and approved partners of The British Business Bank and can be applied for on the respective lender’s or partner’s website. 

Businesses will be required to fill in a short online application form and self-declare that they are eligible for the scheme. Applicants should only need to provide the following:

  • business name

  • business address

  • registered number (if a limited company)

  • business turnover (for the 2019 calendar year)

  • bank account details. 

In the first instance, businesses, where possible, should approach their own bank. They may also consider approaching other accredited providers if they are unable to access the finance they need or if their existing provider is not accredited to provide loans under the scheme. 

It may also be advisable to make sure that your statutory filings are up to date, before you apply, e.g. your annual accounts and tax returns and, if you have a limited company, your Confirmation Statement. We understand that applications may be delayed if a business’s filings are not up to date.

How long is the scheme open? 

As the BBLS is intended to be a temporary response to the COVID-19 pandemic, it will initially be open until 4 November 2020. However, the government retains the right to extend this. 

How much can I apply for? 

Businesses can apply for between £2,000 up to 25% of their turnover. The maximum loan available under the Scheme is £50,000.

If I have more than one business, can I apply for a bounce-back loan for each of them? [Updated 08.06.2020]

Possibly. Companies that are in the same group can’t apply for multiple loans. However, you are entitled to apply for one Bounce Back Loan Scheme facility per separate business, unless that business is part of a group, which means a holding company is at the top of their structure. The guidance has recently been changed on this point. We are aware that many lenders have historically assessed a group to be any collection of businesses with common ownership (over 50%). We are continuing to monitor the lenders’ interpretation of the rules. If you have previously been turned down by a lender, for these reasons, it might be worth reapplying, following the recent change in guidance.

What is the definition of “group” under the Scheme?

For the purposes of eligibility of the Scheme, a group is defined by having a holding company at the top of their structure. However, as part of the application form, businesses are also required to declare that their business together with all “Partner Enterprises or Linked Enterprises” [** see details below] of the business, or under common control, have not breached State Aid limits.

How long will it take me to get the funds? [Updated 16.06.2020]

Given the significant interest in the Bounce Back Loan Scheme, we understand that, in some cases, businesses are having to wait for their applications to be processed and/or for funds to be received. The guidance from the British Business Bank acknowledges the delays and asks businesses to be patient as lenders respond to demand and prioritise support where it is needed most. The guidance also requests that businesses approach their existing lender, wherever possible, so that demand can be managed evenly across the Scheme’s accredited lenders. Businesses are advised to approach a lender directly, ideally via the lender’s website, as phone lines are likely to be busy and branches may not be able to handle enquiries in person.

We would recommend that businesses ensure their accounts, tax returns, and Companies House filings are up to date and that they seek advice from their accountants or other advisors, before submitting their application. We understand that some delays have been caused by businesses failing to provide the correct information when they apply.

Can I apply again if my application under the Bounce Back Loan Scheme has been turned down? [Added 08.06.2020]

Yes. If a business’s application to one lender was declined, then the business is able to make a further application under the Scheme to another accredited lender.

Do I need a business current account before I can apply? [Added 18.05.2020]

The Bounce Back Loan Scheme does not require you to have a business current account with the lender in order to receive a loan. However, lenders will carry out their standard Know Your Customer (KYC) and fraud checks during the application process. If the business is operating via an individual’s personal account, the lender may ask you to convert to a business relationship in line with their standard policies. This is at the sole discretion of the lender and some lenders may not permit an individual to operate their business via a personal account. You could experience delays with your application if this happens, as some lenders may require the conversion to a business relationship to happen before they are able to undertake their standard KYC and fraud checks.

If I have already received a Bounce Back Loan, can I increase (top-up) my existing loan? [Updated 08.06.2020]

The current guidance is a little unclear on this point. Our understanding is that a business can only apply for one loan under BBLS. So, if you have already had a loan approved, then you probably won’t be able to go back into the system and “top-it-up”. When you apply for a loan, you have to confirm whether your business has already received another BBLS loan.

However, we are hearing that individual lenders are taking different views on this, and the guidance is being updated regularly. We would recommend that you try to speak to your bank/lender directly.

If a lender is not willing to increase the amount of the loan, businesses may wish to consider the CBILS. We understand that a business who has previously received a Bounce Back Loan may be allowed to refinance by applying for additional funding under the CBILS, providing that part of the new borrowing is used to repay the original Bounce Back Loan. More details on the CBILS can be found here

What finance products are available under the Bounce Back Loan Scheme? 

Accredited lenders are only permitted to provide term loans (a loan for a specific amount that has a specified repayment schedule) under the Scheme. It is targeted at supporting those businesses who need access to finance quickly and, therefore, requires lenders to offer a standard product. 

Businesses seeking finance above £50,000, or asset or invoice finance under £50,000, may be able to use existing accredited lenders under the Coronavirus Business Interruption Loan Scheme (CBILS). See our FAQ’s on CBILS here

Can I apply for a CBILS facility as well as a Bounce Back Loan Scheme facility? [Updated 22.05.2020]

A business is not able to take out a Bounce Back Loan if they have already been approved for the CBILS. However, a business that has already received finance under the CBILS of £50,000 or less can apply for it to be converted to a Bounce Back Loan. Similarly, we understand a business who has received a Bounce Back Loan will be allowed to apply for additional finance under the CBILS, at a later date, providing that part of the new funding is used to repay the original Bounce Back Loan.  

The terms of each scheme, including borrower protections, are different, and businesses should discuss these with their lender.

When do I have to start repayments?  

Businesses are not required to make repayments for the first 12 months and the government will cover interest payable to the lender during the first year. Following this 12 month period, the borrower will need to make full repayments (the loan and any interest) up to the end of the six-year term, as per their arrangement with the lender. The borrower is 100% liable for repaying the loan and any interest. 

Can I repay early? 

Early repayment is permitted at any stage, without early repayment fees.  

What fees and interest will I be required to pay? 

The government has set the interest rate for this facility at 2.5% per annum. Lenders are not permitted to charge any fees. 

What term can I borrow this over? 

Loans under the Bounce Back Loan Scheme are available over a fixed six-year term. 

What checks will I be subject to? 

Applicants are required to self-declare they meet the eligibility criteria for the scheme. Eligible businesses will be subject to standard customer fraud, Anti-Money Laundering (AML), and Know Your Customer (KYC) checks. 

What turnover do I use if my business started trading part-way through 2019? 

We expect most lenders will require you to estimate what the annual turnover would have been for your first full year of trading, assuming there had been no outbreak of COVID-19.  

What can I use the loan for?  

The business must confirm that the loan will only be used to provide an economic benefit to the business, for example providing working capital, and not for personal purposes. There are no limits on the amount of the facility that can be used for refinancing. 

What happens if I find I’m struggling to repay the loan? 

You should talk to the lender if you are experiencing financial difficulties and they will have standard processes in place to support customers in those circumstances. 

Lenders are not permitted to require personal guarantees for the Bounce Back Loan Scheme but they will seek to recover the loan against business assets, before relying on the government guarantee. 

For sole traders or small partnerships, who often risk their personal assets when borrowing, the terms of the Bounce Back Loan Scheme means no recovery action can be taken over a principal private residence or a primary personal vehicle. 

What if I want to complain about my loan under the Bounce Back Loan Scheme? [Added 20.05.2020]

We are hearing from several businesses that are unhappy with their lender’s responses about the scheme. If you want to make a complaint, the British Business Bank suggests you contact the lender directly and ask for details of their standard complaints process. If you are still not satisfied, they suggest you contact the Financial Ombudsman Service – contact details can be found here.

Can all businesses apply? 

The scheme is open to most UK businesses, regardless of turnover, who self-declare that they meet the eligibility criteria. For some businesses, who self-declare as being a “business in difficulty” on 31 December 2019, there may be restrictions on the amount of finance they are allowed to borrow and what they can do with the loan. 

If you have any questions on the BBLS or any other of the loan schemes that are available, contact HB&O’s Corporate Finance Director, Greg Philp, on  

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Clarification of terms (taken from British Business Bank guidance as of 17 May 2020)


What is a “business in difficulty”? 

A business is considered “in difficulty” if it meets any one of the following criteria on 31 December 2019: 

  • Individuals or companies that have entered into collective insolvency proceedings; 
  • Limited companies which have accumulated losses greater than half of their share capital in their last annual accounts (this does not apply to SMEs less than 3 years old); 
  • Partnerships, limited partnerships or unlimited liability companies which have accumulated losses greater than half of their capital in their latest annual accounts (this does not apply to SMEs less than 3 years old); 
  • Where the undertaking has received rescue aid and has not yet reimbursed the loan or terminated the guarantee, or has received restructuring aid and is still subject to a restructuring plan. 
  • A company which is not an SME where, for each of the last two accounting years: i) your book debt to equity ratio has been greater than 7.5; and ii) your EBITDA interest coverage ratio has been below 1.0.

What is a “sole enterprise”?

An applicant’s business is a ‘sole enterprise’ (for the purposes of the Bounce Back Loan Scheme) if it holds no more than 25% of the capital or voting rights (whichever is higher) in one or more other businesses; and/or other businesses hold no more than 25% of the capital or voting rights (whichever is higher) in the applicant’s business; and nor is it linked to another business according to the criteria for “linked enterprises”. In addition, certain investors may individually have a stake of up to 50% in the business and it may still be considered a sole business: public investment corporations, venture capital companies and business angels (provided the investment is less than €1.25 million), universities and non-profit-making research centres, institutional investors (including regional development funds), or autonomous local authorities (with an annual budget of less than €10 million and fewer than 5,000 inhabitants).

What is a “linked” enterprise?

Linked enterprises form a group by controlling the majority of voting rights of an enterprise, either directly or indirectly; or being able to exercise dominant influence over an enterprise. Enterprises are linked when one enterprise holds a majority of the shareholders’ or members’ voting rights in another enterprise; or can appoint or remove a majority of the other enterprise’s administrative, management or supervisory body; or there is a contract between each enterprise enabling one to exercise a dominant influence over the other; or one enterprise can exercise sole control over a majority of shareholders’ or members’ voting rights in another enterprise. A typical example is a wholly owned subsidiary. An enterprise is indirectly linked to a business if it is directly linked to an enterprise that is linked directly to the business.

What is a “partner” enterprise?

A “partner enterprise” is an enterprise that has a certain financial partnership with another, without one exercising effective direct or indirect control over the other. They are not sole enterprises or linked enterprises. This is the case where both hold 25% or more of the capital or voting rights in each other and are not linked to other enterprises. Among other things, their voting rights in each other do not exceed 50%.