The Recovery Loan Scheme will provide support to UK businesses as they recover and grow following the disruption of the coronavirus (COVID-19) pandemic.
If you’re planning to apply for one with Yorkshire bank, then keep reading this blog!
What is a Recovery Loan Scheme (RLS)?
There’s a few key differences here that we need to discuss. So you really understand whether this is right for you before choosing to apply:
- The RLS is only backed up by the government by 80%. Compared the the BBL which was backed up by 100%. If for any reason your business failed, then the government would pay the bank back 100% of the money that you borrowed. What this means is that the banks are going to be a little bit more hesitant on who they lend to. They are risking 20% of the money, don’t get me wrong its still a great deal and they will lend to millions of businesses.
- The RLS lets you borrow from £25, 000 up to £10,000,000. Compared to the BBL you can only borrow £2,000 to £50,000.
- RLS are to help you get you back to normality meanwhile the BBL were to help keep you alive.
Am I eligible for the Recovery Loan Scheme?
Banks won’t necessarily be looking if you are profitable right now but they will be looking is your business viable going forward. Ask your business these questions:
- Is there an actual real business model there?
- Can you show that with a business plan?
- Or can you show that with historic sales prior to the pandemic?
Before you apply to Yorkshire bank, or any bank, you need to make sure that you get all your paperwork in order.
Prior to applying go to Companies House and check all your accounts and annual return are up to date. Making sure your accounts are in an up to date.
Who should apply a Recovery Loan with Yorkshire bank?
(1) The people that should be looking at Yorkshire bank are people that already have an account there. If you already have an account there, then you can easily log into your internet banking and apply.
You wont have to jump through all the hoops of providing identification etc to open an account. So that’s going to be the fastest route for Yorkshire bank clients.
(2) You are looking at Yorkshire bank because you’re with a bank that doesn’t provide the recovery loan scheme. As I looked on the Great British Business Bank website this afternoon, not all the lenders that had bounced back loans (BBL) are currently offering the recovery loan scheme (RLS). Some of the lenders have not been approved for the scheme yet. They will join later, but I am assuming you might want to borrow a little faster.
If your bank doesn’t provide these loans, then you can look to go to the Yorkshire bank get a loan.
What are the requirements in opening an account with Yorkshire Bank?
They will be checking your credit rating on this. I would suggest that you take out your credit report and look if there’s anything that you can improve.
Now look, that’s pretty much it. So applying for a recovery loan with with Yorkshire bank is a good option.