Online SME Lender Funding Circle Confirms BBLS and CBILS Loan Schemes Ending Soon, Explains How to Apply

Funding Circle (LSE: FCH), an SME lender that facilitates loans in both the US and parts of Europe, notes that the Bounce Back Loan Scheme (BBLS) will be ending in early November of this year.

The BBLS has been provided via the British Business Bank and several accredited providers. The scheme aims to offer financial assistance to SMEs and microbusinesses that may have been negatively impacted by COVID-19. BBLS allows UK based firms to apply for a loan of up to 25% of their annual revenue or turnover. BBLS allows companies to borrow as much as £50,000.

As confirmed by Funding Circle, BBLS loans are provided at a fixed interest rate of 2.5% p.a.. The UK government will be covering the first year or 12 months of interest payments. Under the scheme, borrowers won’t be required to make repayments for the 12 months.

Funding Circle, which is an accredited provider, may offer its service to its customers. They can borrow between £2,000 to £50,000 from the online lender at a fixed rate of 2.5% per year.

There are fixed 6 year terms available through Funding Circle. The company claims it provides fast decisions on loan applications, there’s “nothing to pay” for 12 months, and there’s also “no upfront or early settlement fee.” (Note: for eligibility requirements and other details regarding BBLS, check here.)

The Funding Circle team also notes that at the end of this month, the UK government-backed Coronavirus Business Interruption Loan Scheme (CBILS) will be coming to an end.

CBILS has also been offered via the British Business Bank and several accredited service providers. It’s mainly focused on offering financial assistance to SMEs that have experienced declining revenue and also inconsistent cash flow due to the Coronavirus crisis. Funding Circle notes that businesses may apply for a loan of up to 25% of their annual revenue or turnover.

Funding Circle claims it has a fast application process and can offer financial support to businesses looking to access the CBILS scheme. The UK government will be paying the interest for the first year and will also cover the upfront fee, when customers are approved and take out a Funding Circle CBILS loan. Businesses need not make any repayments for the first year and can take out loans between £50,001 and £500,000 with rates between 1.8%-7.0% APR. (Note: more details available here.)

As covered last month, Funding Circle is reevaluating whether to leverage Open Banking to improve customer experience.

In July 2020, Funding Circle reported that millions of customers had switched to local businesses following the COVID-19 outbreak.

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