Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, if his Department will extend the bounce back interest free period on loans by an additional six months during the covid-19 outbreak.
The Government launched the Bounce Back Loan Scheme (BBLS) to ensure that the smallest businesses could access loans of up to £50,000 to help businesses through this difficult period. Under BBLS no repayments are due from the borrower for the first 12 months of the loan, giving businesses the breathing space they need during this difficult time. In addition, the Government covers the first 12 months of interest payments charged to the business by the lender.
We have always been clear that businesses are responsible for repaying any finance they take out. However, we recognise that some borrowers will benefit from flexibility for their repayments. That is why we announced the Pay As You Grow measures.
Pay As You Grow was designed to provide Bounce Back Loan borrowers more time and flexibility over their repayments by giving them the option to:
On 8th February, the Government announced that these options would be made more generous – removing the requirement to make six payments before accessing the six-month repayment holiday.
Businesses will be able to use these options either individually or in combination with each other. In addition, they have the option to fully repay their loan early and will face no early repayment charges for doing so.