8th October 2021
The deadline for the recovery loan scheme (RLS) could be extended past 31 December 2021, reports suggest.
According to The Daily Telegraph, officials are consulting with banks to reach a decision on the future of the scheme.
Possible plans include cutting the Government guarantee or reducing the personal guarantee - making its terms less generous to businesses than they are now.
The RLS is currently due to close at the end of this year, but its guidance page on GOV.UK says this date is "subject to review".
The scheme was launched in Spring Budget 2021 as a replacement for bounce-back loans and the coronavirus business interruption loan scheme.
At present, it allows businesses to apply for loans at a value of up to £10 million, with the Government guaranteeing 80% of the finance to the lender.
The finance is available in the form of term loans or overdrafts of between £25,001 and £10m, or invoice or asset finance of between £1,000 and £10m per business.
No personal guarantees are taken on facilities up to £250,000, and a borrower's principal private residence cannot be taken as security under the scheme.
Talk to us about the RLS.