Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what steps he is taking to ensure lenders extend the repayment period for Coronavirus Business Interruption Loans from six to 10 years in the event that such requests are made by borrowers.
As part of the Winter Economy Plan, the Chancellor announced our intention to allow lenders to extend the repayment period for CBILS loans where this is needed, to a maximum of 10 years. Since then, we have worked at pace alongside BEIS and the British Business Bank to implement this policy, in line with EU State Aid rules. I can confirm that the British Business Bank has now begun updating scheme documentation with lenders to allow for the extension of a CBILS facility in this way – this process is expected to complete shortly.
I should be clear that CBILS term extensions will be offered at the discretion of lenders, unlike the “Pay As You Grow” options for Bounce Back loans. Extensions will be limited to those borrowers that lenders assess are in difficulty and will benefit from the extension, and only for the duration required, meaning that lenders may offer an extension to 7 years, for example, rather than the maximum 10 years allowed.