In partnership with GC Business Finance, Greater Manchester Combined Authority (“GMCA”) has pledged £10 million emergency funding to support businesses based in the region who were unable to access the Bounce Back Loan scheme.
The scheme aims to plug gaps in Bounce Back Loan availability and is designed to specifically support sole traders, entrepreneurs and business owners struggling to access Bounce Back Loans and who may not already be a client of an existing Bounce Back Loan provider.
- Up to £50,000 loan: Loans will be from £2,000 up to 25% of a business’ turnover or £50,000, whichever is lower
- 100% guarantee: The scheme provides the lender with a government-backed, 100% guarantee against the outstanding facility balance, both capital and interest. The borrower always remains 100% liable for the debt
- Interest rate: The government has set the interest rate at 2.5% per annum, meaning all businesses will benefit from the same low rate of interest
- Interest paid by government for 12 months: The government will make a Business Interruption Payment to the lenders to cover the first 12 months of interest payable, meaning businesses will benefit from no upfront costs
- No principal repayments for first 12 months: Borrowers will not have to make repayments for the first 12 months, thereafter capital will be repaid on a straight line basis
- No guarantee fee for businesses or lenders to access the scheme
- Finance terms: The length of the loan is for six years but early repayment is allowed and without early repayment fees
- No personal guarantees: No personal guarantees are allowed and no recovery action can be taken over a principal private residence or principal private vehicle.
Who can apply?
The fund is open to businesses based in Greater Manchester who were established before 1 March 2020 and who have been impacted by COVID-19.
You may be eligible if:
- You are a UK resident with a business or registered charity in Greater Manchester
- Your business was established before 1st March 2020
- You can certify your business has been impacted by Coronavirus (COVID-19)
- You can certify your business is not in bankruptcy, liquidation or undergoing debt restructuring.
You may not be eligible if:
- You already have a Coronavirus Business interruption Loan (See British Business Bank’s website for more information)
- You are a bank, insurer, re-insurer (but not insurance broker), public sector body, further education establishment, grant-funded or state-funded school
- Your business is subject to collections or collective insolvency proceedings.
How can I apply?
Applications can only be made online. The application process opens today, 16 November, and closes once the fund has been allocated. Businesses are therefore encouraged to apply as soon as possible.
For further information and to make an online application please visit the GC Business Finance website here.
At the time of writing, GMCA is the only Authority to offer this funding. We will of course update you if and when other Local Authorities follow suit.
As always, if you have any questions or concerns please do not hesitate to contact your usual partner.