Recovery Loan scheme extended for two more years

The Recovery Loan Scheme, which was originally launched in April 2021 to help businesses recover from the impact of Covid restrictions, has been extended for a further two years.

With the Bank of England raising interest rates and warning of a recession ahead until 2024, the scheme could be a vital lifeline for many businesses.

Back in the Autumn 2021 Budget, the then Chancellor, Rishi Sunak, announced that the scheme would be extended from 1 January 2022 to 30 June 2022. Due to ongoing economic uncertainty, it has been further extended.

Applications to the extended scheme opened on 1 August 2022 and run until 30 June 2024.

The scheme provides government-backed access to finance for small businesses that are dealing with the financial consequences of the pandemic. The extension does not change the rules of the scheme that existed up to 30 June 2022.

So, for example, the government will continue to underwrite 70% of a loan, and the maximum that can be borrowed remains at £2m. 

However, one change under the extension is that lenders may now require a personal guarantee from the borrower, in line with standard commercial practice.

Further help available

We continue to work with our clients on cash flow projections to help them identify when funding may be required for their business.

If you would like our help with identifying possible funding needs, or if your business requires a review, please contact our Restructuring Team for a conversation.

You can also check out our articles and guides in our Restructuring Knowledge Hub.