Question to the Department for Business, Energy and Industrial Strategy:

To ask Her Majesty's Government whether the Bounce Back Loan Scheme is a replacement for the Coronavirus Business Interruption Loan Scheme and, if so, whether the latter will be phased out; and what assessment they have made of how many applications they expect to be made to the Bounce Back Loan Scheme, and how many of these they expect to be successful.

The Bounce Back Loan Scheme will operate alongside the Coronavirus Business Interruption Loan Scheme (CBILS). Both are temporary schemes supporting small and medium-sized businesses during these unprecedented times.

The Coronavirus Business Interruption Loan Scheme provides businesses with annual turnover of under £45m with access to working capital of up to £5m. It supports a wide range of business finance products, including term loans, overdrafts, invoice finance and asset finance facilities.

The Bounce Back Loan Scheme supports the smallest SMEs by providing loans from £2,000 up to 25% of the business’ turnover, with a maximum loan size of £50,000. This Scheme launched on 4 May and requires businesses to complete a short, simple, online application form, meaning that applications can be processed rapidly.

A business is not able to take out a Bounce Back Loan Scheme facility if they have been approved for a CBILS facility, and vice versa. However, all accredited lenders who have approved CBILS loans so far will allow customers to refinance their loan into the Bounce Back Loan Scheme where appropriate.

More than 69,000 Bounce Back Loans worth over £2 billion have been approved during the first 24 hours of the scheme.

The Government continues to work with the British Business Bank, HM Treasury and lenders to assess how effectively these schemes are working.