Question to the Department for Business and Trade:

To ask the Secretary of State for Business and Trade, what rules and regulations apply to the operation of Bounce Back Loan Scheme agreements as of 24 January 2024; and whether lenders may (a) levy fees and (b) charge additional interest under the scheme.

The Bounce Back Loan scheme provided financial support to businesses across the UK that faced disruption as a result of the Covid-19 pandemic.

A lender could provide a six-year term loan from £2,000 up to 25% of a business’ turnover, up to a maximum of £50,000. The scheme gave the lender a full (100%) government-backed guarantee against the outstanding balance of the facility.

As part of the scheme design, no early repayment fees or other lender-levied fees of any type following drawdown were permitted. The Government covered the first 12 months of interest, which meant that borrowers paid 0% interest for the first year. Following that, an interest rate of 2.5% per annum applies.

A list of frequently asked questions is available on the British Business Bank’s website: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/faqs-for-small-businesses/.