The Team

Change to State Aid rules makes it easier for businesses to get help
17/07/2020
Change to State Aid rules makes it easier for businesses to get help

The Coronavirus Business Interruption Loan Scheme (CBILS) was introduced to help small and medium sized businesses access loans and other kinds of finance up to £5 million. The UK Government guarantees 80% of the finance to the lender and pays the interest and any fees charged by the lender for the first 12 months.
 

CBILS is available to any business based in the UK and which has an annual turnover of up to £45 million.
 

In order to be eligible, the business needs to show it would be viable were it not for the pandemic and also that it’s been adversely affected by the pandemic. In addition, if the business wants to borrow £30,000 or more, you need to confirm that your business was classed as a business in difficulty on 31 December 2019.
 

It was this last point that caused difficulty for a number of businesses whose applications for CBILS were rejected. European Union State Aid Rules meant that some viable UK businesses with significant debts were classed as “Businesses in difficulty” and this prevented them from being able to borrow through CBILS.
 

However, the EU changed its rules in June and that meant companies with a turnover of less than £9 million and fewer than 50 employees would not be considered “businesses in difficulty”.

This now means that more UK businesses will be able to access CBILS.
 

Paul Scully, MP, the UK Small Business Minister that the change “will mean that even more small firms will be able to access much-needed financial support”.
 

If you would like to find out more about CBILS or make an application, please click here to visit the UK Government’s website which contains all of the relevant information.