CBILS and what banks and SMEs need to know | Fieldfisher
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Coronavirus Business Interruption Loan Scheme

At the last Budget on Wednesday 11 March, HM Government announced the introduction of the Coronavirus Business Interruption Loan Scheme (CBILS).  CBILS is a government scheme to ensure the availability of credit to SMEs during the Covid-19 pandemic – particularly smaller SMEs – delivered by the government-backed British Business Bank. The scheme is now live and we have outlined the key points of the scheme below relevant to both lenders and borrowers.


Government Backed SME Lending

What is CBILS?

It is a new scheme, announced by The Chancellor at Budget 2020, that can provide facilities of up to £5m for smaller businesses across the UK who are experiencing lost or deferred revenues, leading to disruptions to their cashflow.

In brief:

  • CBILS covers term facilities, overdrafts, invoice finance facilities and asset finance facilities
  • The maximum value of facility provided under CBILS will be £5 million
  • No fee for borrowers to access the scheme
  • Eligibility: be UK-based business; turnover ≤ £45m; operate in a sector that is not ineligible or restricted; be otherwise unable to meet a lender's normal lending requirements for a fully commercial financing
  • Ineligible and restricted sectors include banks and insurers (amongst others).
  • To apply borrowers should approach one of the accredited lenders through their website

In more detail

CBILS is designed to be offer government-backed support to private sector lending.  Moreover, the scheme works with over 40 'accredited lenders' who provide the financing, however, that provision of credit is then supported by HM Government in the form of a guarantee to the accredited lender of the borrower's obligations (up to a value of 80% of the facility offered).  Decision-making on the provision of credit and eligibility for CBILS rests fully with the accredited lender.
  • The accredited lender (to whom the borrower applies for finance) receives a guarantee from the British Business Bank (which is backed by HM Government) up to the value of 80% of the facility provided.  
  • The borrower remains liable for payments and repayments under the financing but the credit support offered enables lenders to provide credit where they would otherwise be unable to or be constrained.
  • HM Government will "cover" the first 12 months of interest payments such that all borrowers will be entitled to a "Business Interruption Payment" to cover interest and fees for a period of 12 months from the date of drawdown (subject to a €800,000 cap for all borrowers save a number in particular sectors, including fisheries, aquaculture and agriculture to which lower caps apply).


A borrower must be UK-based with a turnover not exceeding £45m per annum. 
  • The borrower must not have received State aid beyond €200,000 over the current previous two financial years. 
  • The borrower must be unable to meet a lender's normal lending requirements for a fully commercial financing (e.g., for lack of an adequate security package) but be otherwise financial viable in the longer term.  In other words, if finance can be offered on the ordinary day-to-day business terms of the lender, CBILS will not be needed or indeed used. 
  • CBILS is unavailable to those in "ineligible" or "restricted" sectors: see the British Business Bank website, but in broad terms (as at the date of writing) the following are ineligible: banks, building societies, insurers and reinsurers (but not insurance brokers); public sector (e.g., schools); employer, professional, religious or political membership organisations and trade unions.

Types of financings covered

CBILS covers a wide range of business financing products, including:
  • term facilities
  • overdrafts
  • invoice finance facilities
  • asset finance facilities
  • Finance terms covered are from 3 months to 10 years for term loans and asset finance and up to a maximum of 3 years for revolving credit facilities and invoice finance. 
  • The maximum facility value covered under CBILS will be £5 million.

Fieldfisher is advising both lenders and borrowers on CBILS.

If you would like assistance on understanding how the CBILS  would work for you (or indeed alternative financing arrangements) including documentation and steps, do get in touch with a member of the team below.

Dougall Molson | Partner
Oliver Abel-Smith | Partner
Michelle Shean | Partner
Robin Spender | Partner
Jayne Backett | Partner
Simon Lafferty | Senior Associate


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