What are the key differences between CBILS and RLS?
After receiving a number of questions about the differences between the former Coronavirus Business Interruption Loan Scheme (CBILS) and the new Recovery Loan Scheme (RLS), BCRS Business Loans have put a handy table together to compare features of the new and old schemes. 

Firstly, we just want to point out that CBILS, which was a lifeline for businesses during the pandemic, ended on 31st March 2021 and is therefore no longer open for applications. 

And whilst a replacement scheme called the Recovery Loan Scheme (RLS) was launched by the British Business Bank just a few days later, designed to support access to finance for UK businesses as they grow and recover following the pandemic, there are some significant changes that businesses should be aware of. 

Some similarities between CBILS and RLS are as follows

  • Like CBILS, RLS will be delivered by accredited delivery partners for the British Business Bank – such as BCRS Business Loans in the West Midlands
  • Businesses apply to respective delivery partners to discover if they are eligible for RLS
  • Like CBILS, RLS is designed to support businesses that have been impacted by Covid-19
  • Like CBILS, RLS provides lenderswith a government-backed guarantee (borrowers always remain 100% liable for the debt).

We’ve put together a handy table below to help you that summarises some features of the loan schemes side by side. (Full details of the Recovery Loan Scheme and FAQs can be found on the British Business Bank website here).  

Feature CBILS (ended on 31 March) RLS (accepting applications)
Target Audience SMEs with turnover of less than £45M. *All businesses across the UK affected by Coronavirus.
Finance available £50,001 – £5Million

Minimum facility sizes vary, starting at £1,000 for asset and invoice finance, and £25,001 for term loans and overdrafts.

The maximum amount of a facility provided under the scheme is £10M per business.

Types of Finance 
  • Term loan
  • Overdraft
  • Invoice finance
  • Asset finance
  • Term loan
  • Overdraft
  • Invoice finance
  • Asset finance
Term Length  3 months-6 years

For term loans and asset finance facilities: from three months up to six years.

For overdrafts and invoice finance facilities: from three months up to three years.

Gov pays first 12 months interest and fees? Yes Businesses are required to meet the costs of interest payments and any fees associated with the RLS facility.
Personal Guarantee required?

Personal guarantees are not permitted for facilities of £250,000 or less.

Above £250,000 the maximum amount that can be covered under CBILS is capped at a maximum of 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied.

No personal guarantees can be held over Principal Private Residences.

Personal guarantees are not permitted for facilities of £250,000 or less.

Above £250,000 the maximum amount that can be covered under RLS is capped at a maximum of 20% of the outstanding balance of the RLS facility after the proceeds of business assets have been applied.

No personal guarantees can be held over Principal Private Residences.

Annual Turnover Limit? An annual turnover of less than £45 million. No turnover restrictions.

*Please note: The following are not eligible under RLS:  
– Banks, Building Societies, Insurers and Reinsurers (excluding Insurance Brokers)  
– Public sector bodies.  
– State funded primary and secondary schools. 

What happens if you are turned down for the Recovery Loan Scheme by a lender?

Just because you are turned down by one lender does not mean that another will do the same. There is a baseline of eligibility when applying for the RLS, but each lender may require additional criteria to be met in order to offer you finance. Ultimately, it’s important to keep in mind that if one turns you down, you are still able to approach other accredited lenders that offer the scheme. 

Access to multiple Covid-19 schemes?

Businesses that have taken out a CBILS, Coronavirus Large Business Interruption Scheme (CLBILS) or Bounce Back Loan Scheme (BBLS) facility are able to access the new scheme although the amount they have borrowed under a previous scheme may in certain circumstances limit the amount they may borrow under RLS. 

No turnover requirement?

The scheme is open to most businesses, who meet the eligibility criteria, regardless of turnover. 

Applying for RLS through BCRS Business Loans: 

BCRS Business Loans are a delivery partner for the RLS and are committed to supporting SMEs across the West Midlands with loans from £25,001 – £150,000. 

RLS scheme features via BCRS Business Loans 

Feature BCRS Business Loans Offering
Target audience West Midlands based SMEs

Finance available

 

£25,001 – £150,000 (BCRS offer Term Loans only)
Credit checks We will be required to undertake credit and fraud checks for all applicants.

Term length

 

1 to 5 years
Interest and fees To be paid by the borrower from the outset

Personal Guarantee

 

Not required for RLS facilities from BCRS.
Annual turnover limit BCRS has a turnover limit of no more than £45 million per annum.

 

Benefits to RLS at BCRS: 

  • No early repayment fees, 
  • Hands-on support throughout the application process, 
  • Loan can be drawn down in an average of just two weeks. 

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