The Government has introduced greater flexibility for businesses to repay back their Bounce Back Loans.
The new ‘Pay as You Grow’ repayment scheme will enable Bounce Back Loan borrowers to customise their payments according to their circumstances.
Businesses will have the option to:
- Extend the length of their loan from six to ten years;
- Make interest-only payments for six months (with the option to use this up to three times throughout the loan); or
- Pause repayments for up to six months.
The option to pause repayments is now available to all businesses from the first repayment, rather than after six repayments have been made. This means that businesses have the option to make no payments on their loans until eighteen months after they originally took them out.
The Government will also cover the costs of interest for the first year of the Bounce Back Loan.
How to apply
Lenders will get in touch with businesses to provide details on the Pay as You Grow scheme and with more information on how to access flexible repayment options. Borrowers should only expect correspondence from their lender three months before the first repayment is due.
Further details on the Bounce Back Loan Scheme can be found here.