Recovery Loan Scheme opens

Recovery Loan Scheme

Applications are now open for the £75bn Recovery Loan Scheme (RLS). The scheme opened for applications on 6 April 2021 and is available to businesses affected by Covid-19. There is no turnover restriction for businesses accessing the scheme. 


RLS will run until 31 December 2021. It will be available on top of various business grants available through local authorities to help businesses through the phased ending of lockdown.


The main stipulation to the scheme is that the business must have been affected by the pandemic. The finance can be used for any legitimate business purpose – including managing cashflow, investment and growth.


RLS is still available to businesses who have already borrowed from other coronavirus loan schemes. However, the amount borrowed in a previous scheme may limit the amount available under RLS.


RLS will be available through a number of British Business Bank accredited lenders. A list of accredited lenders can be found on the British Business Bank website.  


A key aim of the Recovery Loan Scheme is to improve the terms on offer to businesses, but if there is the choice of a commercial loan on better terms without requiring the guarantee provided by the RLS, this should be considered.


RLS gives the lender a government-backed guarantee against the outstanding balance of the facility. Borrowers are 100% liable for the debt.


For loans of £250,000 or less, the lender will not take any form of personal guarantee. For amounts over £250,000, the lender has the discretion to decide whether to take personal guarantees.


The scheme is capped at a total loan facility of £10m per business. Minimum facility sizes vary, starting at £1,000 for asset and invoice finance, and £25,001 for term loans and overdrafts. The annual effective rate of interest, upfront fee and other fees cannot be more than 14.99%.


Lenders will be required to undertake all standard checks for all applicants. Applicants for finance will need to provide evidence to show they can afford to repay the RLS-backed facility. It is important to note that no personal guarantees can be held over principal private residences.


For more information on the scheme, please go to



Blog post uploaded 8 Apr 2021