There is more access to capital than you think, starting with the Small Business Administration.
Tag Archive for Small Business Loans
Hot Business News Today
eBay launches small business loan service for its 300,000 SME sellers
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
eBay has gone into the business of lending directly to its small business sellers, offering loans of anything betweeen £500 and £1m to SMEs.
In doing so, eBay is parking its tanks on the lawn of former subsdiary PayPal, which already offers quick loans to small business users.
PayPal has also been aggressively growing its lending business, with an outstanding loanbook of $2.7bn at the end of the first quarter.
>See also: Norah Coelho of PayPal Q&A: ‘Getting access to finance is incredibly important’
The move also puts eBay in competition with Britain’s less-well-capitalised high-street banks that target small business customers. By way of comparison, eBay’s $41bn market capitalisation is about 50 per cent higher than that of NatWest, the UK’s largest small business lender.
eBay says its same-day loan service is needed to help its 300,000 small business users bounce back quickly from the pandemic.
Nearly one third (31 per cent) of the UK’s 5.9m small businesses face going bust in under a month due to inadequate access to finance, according to research.
>See also: Qardus opens Islamic finance to small business for first time
Two in five (40 per cent) small business owners have been denied credit from banks,
Hot Business News Today
eBay launches small business loan service for its 300,000 SME sellers
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
eBay has gone into the business of lending directly to its small business sellers, offering loans of anything betweeen £500 and £1m to SMEs.
In doing so, eBay is parking its tanks on the lawn of former subsdiary PayPal, which already offers quick loans to small business users.
PayPal has also been aggressively growing its lending business, with an outstanding loanbook of $2.7bn at the end of the first quarter.
>See also: Norah Coelho of PayPal Q&A: ‘Getting access to finance is incredibly important’
The move also puts eBay in competition with Britain’s less-well-capitalised high-street banks that target small business customers. By way of comparison, eBay’s $41bn market capitalisation is about 50 per cent higher than that of NatWest, the UK’s largest small business lender.
eBay says its same-day loan service is needed to help its 300,000 small business users bounce back quickly from the pandemic.
Nearly one third (31 per cent) of the UK’s 5.9m small businesses face going bust in under a month due to inadequate access to finance, according to research.
>See also: Qardus opens Islamic finance to small business for first time
Two in five (40 per cent) small business owners have been denied credit from banks,
Hot Business News Today
Small business banking dispute service costs £23m to set up
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Business Banking Resolution Service (BBRS), the voluntary ombudsman set up to handle any banking dispute between small businesses and high-street banks, has cost £23m to establish.
Seven high-street banks have split the £23m setting-up cost of the banking dispute service between them, so no taxpayer money was involved.
But BBRS has yet to pay out damages to any small business since its launch was delayed from November until mid-February.
>See also: Business Banking Resolution Service opens doors in November
The BBRS said that it hopes to settle its first disputes between wronged small business borrowers and banks by the summer.
About 500 disputes were pre-registered with the BBRS before its mid-February launch, and it has 160 “live” cases going through at the moment, plus another 48 new cases register since February 14.
The BBRS was set up after thousands of companies were damaged by banking scandals. It gives small businesses an independent view on banking disputes. It is funded by seven banks but is independent of them.
Conservative MP Kevin Hollinrake, co-chairman of the all-party parliamentary group on fair business banking, described the setting-up costs to The Times as “eye-watering”.
For example, £9.2m was spent on “third-party delivery costs” to get
Hot Business News Today
Small businesses struggling to get credit from Recovery Loan Scheme
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Small businesses are struggling to get loans through the Recovery Loan Scheme launched earlier this month to replace emergency schemes such as Bounce Back Loans, according to the Federation of Small Businesses (FSB).
Banks blame tougher credit checks and higher interest rates for the sluggish take-up.
Craig Beaumont, chief of external affairs at the FSB, told the Sunday Times that “the government should be throwing everything it’s got at getting businesses across this ‘unlock’ phase and into the recovery, to avoid businesses falling at the final hurdle because of lack of cashflow”.
>See also: How does the Recovery Loan Scheme compare with other alt-fi options?
Applications were in the “low thousands” in the first week, according to the Financial Times, with fewer again accepted as potential borrowers. Many of these applicants were existing users of government coronavirus loan schemes, the newspaper reported.
According to the FT, one of the largest UK banks received fewer than 500 applications in the first two days after the scheme went live on April 7. This same bank approved close to 2,000 applications in the same period when the Bounce Back Scheme opened last year.
Recovery Loan Scheme application rules are much more stringent
Hot Business News Today
How does the Recovery Loan Scheme compare with other alt-fi options?
by fundingoptions • • 0 Comments
Originally written by fundingoptions on Small Business
The Recovery Loan Scheme (RLS) launched on April 6 2021. The scheme, which replaces the CBILS, CLBILS and BBLS, is currently set to run until December 31, subject to review.
You can apply for finance through the RLS if your business has been impacted by the pandemic: it’s specifically designed to enable business owners to support their plans with additional funding as the nation enters a period of recovery following the lockdown.
You can use your RLS loan for any legitimate business purpose. For instance, you might use it to purchase a piece of necessary equipment or hire a member of staff to meet an increase in demand, or to manage cash flow as you reopen your premises.
Although the RLS has its benefits, it’s certainly not the only finance option on the table.
In fact, the British Business Bank – the organisation in charge of accrediting lenders for the scheme – states that ‘a key aim of the Recovery Loan Scheme is to improve the terms on offer to you, but if a lender can offer you the choice of a commercial loan on better terms, without requiring the guarantee provided by the RLS, they should do
Hot Business News Today
Recovery Loan Scheme 2021 full update – where do I apply for my loan?
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
The Government has launched its long-awaited recovery loan scheme today (April 6).
Announced at last month’s Budget, the recovery loan scheme (RLS) has replaced the Bounce Back Loan Scheme (BBLS) and the Coronavirus Business Interruption Loan Scheme (CBILS).
The aim of the scheme is to help businesses of all sizes to access loans and other finance so they can recover from the pandemic and move forward. It can be put towards improvements like managing cash flow, growth and investment.
Up to £10m is available per business. The minimum funding is £1,000 for asset and invoice finance and £25,001 for term loans and overdrafts. The total amount offered is at the discretion of the participating lender. They will carry out credit checks and fraud checks before granting you the finance.
>See also: What is invoice finance?
The Government is guaranteeing 80 per cent of the finance to the lender and the borrower will always be 100 per cent liable for the debt. The annual interest rate and upfront and other fees cannot be more than 14.99 per cent.
Unlike BBLS and CBILS, the RLS is being lent on standard commercial banking terms. Kreston Reeves says that businesses will need to
Hot Business News Today
Recovery Loan Scheme 2021 full update – where do I apply for my loan?
by Anna Jordan • • 0 Comments
Originally written by Anna Jordan on Small Business
The Government has launched its long-awaited recovery loan scheme today (April 6).
Announced at last month’s Budget, the recovery loan scheme (RLS) has replaced the Bounce Back Loan Scheme (BBLS) and the Coronavirus Business Interruption Loan Scheme (CBILS).
The aim of the scheme is to help businesses of all sizes to access loans and other finance so they can recover from the pandemic and move forward. It can be put towards improvements like managing cash flow, growth and investment.
Up to £10m is available per business. The minimum funding is £1,000 for asset and invoice finance and £25,001 for term loans and overdrafts. The total amount offered is at the discretion of the participating lender. They will carry out credit checks and fraud checks before granting you the finance.
>See also: What is invoice finance?
The Government is guaranteeing 80 per cent of the finance to the lender and the borrower will always be 100 per cent liable for the debt. The annual interest rate and upfront and other fees cannot be more than 14.99 per cent.
Unlike BBLS and CBILS, the RLS is being lent on standard commercial banking terms. Kreston Reeves says that businesses will need to
Hot Business News Today
What happens if I can’t repay my Bounce Back Loan?
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
Can I apply for a second Bounce Back Loan?
Yes, you can “top-up” your existing Bounce Back Loan if you originally borrowed less than the maximum amount available to you.
However, as of November 10 2020, you cannot apply for a second, separate Bounce Back Loan either from your existing lender or another lender.
How many Bounce Back Loans can I have?
A top-up is only available from your existing BBLS lender. A borrower can apply for a top-up that is for the lesser of £50,000 or 25 per cent of the annual turnover you certified in your original successful Bounce Back Loan Scheme application form, minus the value of your original loan.
Bounce Back Loan top ups
Under the Bounce Back Loan Scheme top up, if a borrower certified an annual turnover of £100,000 in their original application and took out a Bounce Back Loan of £20,000 (20 per cent of that certified annual turnover), they can ask to borrow an additional £5,000 (5 per cent of that certified annual turnover), taking their Bounce Back Loan to the maximum 25 per cent of their originally certified annual turnover.
Varying turnover amounts certified in original loan applications and the differing
Hot Business News Today
Government Bounce Back Loan for your small business
by Timothy Adler • • 0 Comments
Originally written by Timothy Adler on Small Business
What is the latest Bounce Back Loan news?
The Government launched the Bounce Back Loan Scheme (BBLS) on May 4 2020 to help small and microbusinesses get through the coronavirus pandemic.
Your small business can borrow a sum equivalent to up to 25 per cent of turnover, capped at £50,000 per business.
The Government will cover the first year of interest payments, meaning you have to repay the rest of the loan yourself. Interest is fixed at 2.5 per cent per annum.
Because the Government Bounce Back Loan is unsecured debt, this means the 29 accredited lenders including the high-street banks cannot ask you for personal guarantees. This means the lender cannot come after your house or personal vehicle if you default.
However, the Government Bounce Back Loan must be repaid and is not a grant.
When does the Bounce Back Loan end?
The Government Bounce Back Loan Scheme (BBLS) is due to expire on March 31.
Am I eligible for a Bounce Back Loan?
Most businesses with some exceptions can apply for a Bounce Back Loan provided they were properly trading before March 1 2020.
You must not have taken out any other form of Government Covid-19 financial support, such as a