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10 Reasons Why You Should Apply for the Government’s Recovery Loan Scheme

Business Finance

10 Reasons Why You Should Apply for the Government’s Recovery Loan Scheme

Updated: 26 October 2023

The new iteration of the Recovery Loan Scheme (RLS) launched in August 2022 to help UK businesses access finance as they look to invest and grow.

This scheme is specifically designed to help businesses like yours adapt during challenging times. Offering RLS alongside our fixed-rate business loans allows us to say yes to more businesses, and provide the finance you need to thrive and drive your business forward. 

Not sure if the RLS is right for you? Wondering about some of the features of the Recovery Loan Scheme? Here are 10 reasons why you should apply today:

1. The Recovery Loan Scheme is designed by the Government specifically to help businesses access finance 

The Recovery Loan Scheme was designed by the UK Government expressly to improve the terms on offer to businesses in the wake of the Covid-19 pandemic. Money is loaned through accredited lenders, such as Funding Circle, and the Government gives the lender a 70% guarantee on the loans. That means that if the business can’t repay the loan, the Government will reimburse the lender. Although the borrower remains liable for the full loan amount, the guarantee allows lenders to say yes to more businesses. 

2. Borrow £25,001 to £250,000 with a Funding Circle Recovery Loan 

Recovery Loans range from £25,001 to £2 million, meaning a wide range of businesses can enjoy quick access to critical funds they need to support recovery, operations, and growth. At Funding Circle, we offer Recovery loans of £25,001 to £250,000.

3. Most businesses are eligible for the Recovery Loan Scheme.

There are just a handful of criteria you need to meet to qualify for a Recovery loan from Funding Circle. Your business needs to: 

  • Have a turnover of up to £45 million 
  • Be trading in the UK for a minimum of 2 years
  • Be a limited company 
  • Use the loan for business purposes such as working capital or investment 
  • Not be in difficulty or have any collective insolvency proceedings ongoing

The following types of businesses are not eligible for Recovery loans:

  • State-funded primary or secondary schools, 
  • Public sector bodies
  • Banks and building societies 
  • Insurers and reinsurers, with the exception of insurance brokers

4. The money can be used for almost any purpose 

RLS loans can be used for any legitimate business purpose, including managing cash flow, investment, and growth.

5. The Recovery Loan Scheme terms are flexible

Funding Circle Recovery loans are available from 2 to 6 years.

6. You can access RLS funding even if you already have a Government-backed loan

If you took out a CBILS, BBLS, or RLS facility before 30 June 2022, you can still apply for the new iteration of the RLS scheme, and there is no requirement to refinance any existing Government debt. 

It’s important to note that as RLS loans are supported by a Government guarantee, they count as a form of subsidy. There are limits on the amount of subsidy a business can receive. You can find more information on this on the British Business Bank’s website, or in your Subsidy Certification document if and when you accept a loan offer.

7. The application process is simple

To keep things simple, you only need to make one 10-minute application to be considered for both the Recovery Loan Scheme and our own fixed-rate business loans. We’ll then assess which product your business is eligible for, on the best possible terms. 

If we can offer a business a loan on better terms without RLS, we will do so.

8. There’s no impact on your credit score to apply

If you’re a limited company or LLP, you can now apply for a loan and get a personalised quote without impacting your credit score. This is because we only run a soft credit check search on your personal and business credit reports when you apply, meaning you can find out what you could borrow and decide if it’s right for you with complete peace of mind. 

9. You’ll get a quick decision and the payout is fast

You can get a decision on your loan application in as little as 1 hour and, once you accept, the money is paid out typically within 48 hours. 

10. There are no fees for full early repayment 

If you want to settle your loan Recovery loan in full, you can do so with no fees and you’ll only pay interest on the time you borrow. 

To see how we can help you, check your eligibility for a Recovery Loan in just 30 seconds

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