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How to Apply For the Recovery Loan Scheme, Am I Eligible?

The COVID-19 pandemic has been particularly tough on business owners. If business has been disrupted, you may be eligible for the various financing options available via the Recovery Loan Scheme (RLS). 

Here, you can find out all about the RLS, whether you are eligible and how you can access financial support to get your business back on track if it has been affected by the COVID-19 pandemic. 


About the Recovery Loan Scheme – What is the RLS?

The Recovery Loan Scheme (RLS) is a government scheme to help UK businesses that have been affected by the COVID-19 pandemic. The scheme allows businesses of any size to access up to £10 million finance so they can recover and grow.

The actual amount offered, and the terms associated with the loan, are at the discretion of participating lenders. The government guarantees 80% of the finance to the lender, but as the borrower, you will be liable for the debt. 

You can choose from various products depending on what best suits your business:

  • A term loan
  • An overdraft
  • Invoice finance
  • Asset finance


RLS Eligibility

You can apply for an RLS loan if your business is trading in the UK and it meets the following criteria:

  • Your business is viable, or would be viable if it was not for the COVID-19 pandemic
  • Your business has been negatively affected by the COVID-19 pandemic 
  • Your business is not in collective insolvency proceedings (please note that if your business is in scope of the Northern Ireland Protocol, you should look up the eligibility criteria separately) 

If you have previously accessed finance through the Bounce Back Loan Scheme (BBLS), the Coronavirus Business Interruption Loan Scheme (CBILS) or the Coronavirus Large Business Interruption Loan Scheme (CLBILS), the RLS is still open to you. However, the maximum amount you can borrow may be affected and any outstanding balances will be taken into consideration. 

You can check RLS eligibility with Busby Finance by filling in a simple form – no credit check needed.


RLS Credit Check

To apply for a business recovery loan, you will need to undergo a credit check. Lenders will also need to carry out fraud checks. The specific checks, and the approach taken, may vary between lenders. 

If you have been refused credit in the past, you may still be eligible for a recovery loan. Lenders will review applications and decide whether to offer finance on a case-by-case basis.


RLS FAQs & T&Cs 

Here are answers to some of the most frequently-asked questions about the Recovery Loan Scheme: 

Q: How long will the RLS run?

A: The RLS will run up until 31st December 2021, subject to review.


Q: How much can I borrow?

A: Through the Recovery Loan Scheme, you can borrow up to £10 million as an individual business. Term loans and overdrafts are available for amounts between £25,001 and £10 million. Invoice and asset finance options are available for amounts between £1,000 and £10 million. 

Up to £30 million can be loaned across a group. 


Q: How do I know if I am eligible for the RLS?

A: You will need to meet the following criteria to apply for an RLS loan:

  • Your business is viable, or would be viable if it was not for the COVID-19 pandemic
  • Your business has been negatively affected by the COVID-19 pandemic 
  • Your business is not in collective insolvency proceedings

Your application will then be assessed by the lender to determine affordability – the final decision lies with the lender.


Q: What term can I borrow over?

A: This depends on the type of finance. Overdrafts and invoice finance options are available for up to three years, whereas term loans and asset finance facilities are available for up to six years.


Q: How do I apply for a business loan via the government Recovery Loan Scheme? 

A: You will need to apply for a loan via a lender accredited by the British Business Bank. Busby Finance can provide access to a wide panel of RLS accredited lenders – get in touch to discuss your situation. 


Q: Is there a minimum annual turnover required to apply? 

A: No – there are no minimum or maximum turnover requirements. 


Q: Are there any minimum trading history requirements? 

There are no minimum trading history requirements, unlike with the CBILS, which had a one-to-two-year requirement. 


Q: Do I need to give a personal guarantee? 

A: Personal Guarantees are not permitted for loans of less than £250,000. For facilities over £250,000, a Personal Guarantee may be required. 


Contact Us About the RLS

Busby Finance specialises in supporting business owners in the SME sector, whether you run a start-up or a well-established company. If you want to know more about the RLS and getting back on track after the COVID-19 pandemic, please get in touch. We can provide access to RLS accredited lenders and help you check your eligibility. 

Call 01213 122 727, email or send us a message.