RLS pictureThinking of applying for the new Recovery Loan Scheme – Here’s all the detail you need!

A new government-backed loan scheme called Recovery Loan Scheme launched on 6th April 2021.

It is aimed at providing additional finance to those businesses that need it. A new scheme was announced in the budget by the Chancellor of the Exchequer, Rishi Sunak to help businesses to get back on their feet. 

The details that have been announced so far:

  • New loan scheme will provide further support to protect businesses and jobs
  • Loans will include 80% government guarantee and interest rate cap
  • From 6th April businesses ranging from coffee shops and restaurants to hairdressers and gyms – can access loans varying in size from £25,000 up to a maximum of £10 million
  • Invoice and asset finance is available from £1000
  • The scheme runs until 31st December 2021
  • It is administered by the British Business Bank with loans available through a diverse network of accredited commercial lenders
  • 26 lenders have already been accredited for day one of the scheme with more to come shortly
  • Interest rates have been capped at 14.99% and are expected to be much lower in the vast majority of cases
  • The recovery loan Scheme can be used as an additional loan on top of support received from the emergency schemes such as Bounce Back Loan Scheme and CBILS (Coronavirus Business interruption Loan Scheme
  • You need to have been impacted by Covid-19 – you will need to confirm this to the lender
  • You must be carrying out a trading activity in the UK
  • You must have a viable business proposition – your lender may disregard (at its discretion) any concerns over short-term to medium-term business performance due to the uncertainty and impact of Covid-19
  • Lenders will be required to undertake standard credit, fraud, Anti-Money Laundering (AML) and Know Your Customer checks for all applicants

These loans can be taken alongside existing COVID loans to help firms refinance, restructure and go for growth.  It’s a vital support as restrictions are relaxed and demand returns to normal, allowing businesses to recover, save jobs and support them in re-opening.

To read more on the government website click the link https://www.gov.uk/government/news/recovery-loan-scheme-launches-today


According to the British Bank website you can use the loan for: –

To finance any legitimate business purpose, including

  • Managing Cashflow
  • Investment & Growth

However, you must be able to take additional debt finance for these purposes.

It does however say: – that if you have already borrowed for BBL or CBILS Recovery Loan scheme is still open to you, although the amount you have borrowed under an existing scheme MAY in certain circumstances limit the amount you may borrow under this scheme.



A lender can provide up to £10 million as one of the following facilities.

  • Term Loan
  • Overdraft
  • Invoice finance
  • Asset finance



Recovery Loan Scheme is a government backed scheme to the lender.  As the borrower you are always 100% liable for the debt!

If you are borrowing £250,000 or less

The lender won’t take any form of personal guarantee.



You will need to provide certain evidence to show you can afford to repay the RLS- backed facility.  This is likely to include

  • Management accounts
  • Business plan
  • Historic accounts
  • Details of assets



For an up to date list please check out the British Business Bank’s website below, but at the time of writing were the main High Street Banks plus other institutions like:-

Aldermore, Bank of Scotland, Barclays, Danske Bank, HSBC, Clydesdale Bank, Lloyds Bank, NatWest, Santander, Skipton Business Finance, RBS, Ulster Bank, Yorkshire Bank, Paragon, Oak North Bank


For details on how to apply https://www.british-business-bank.co.uk/ourpartners/recovery-loan-scheme/for-businesses/


It is important that you take professional advice before making any decisions based on the information that you learnt here. While every effort has been made to make sure it is accurate it cannot be precisely tailored to your personal circumstances. This article is for general information only and no action should be taken, or refrained from, as a result of this information.  Professional advice should be taken based on specific circumstances in each individual case.  Whilst we endeavour to ensure that the information contained in the article is correct, no liability  will be accepted by KMA Accountancy which is a trading name of Kim Marlor Associates Ltd or damages of any kind arising from the contents of this communication, or for any action, inaction  or decision taken as a result of using any such information.

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