The Bounce Back Loan Scheme: What It Means for Struggling Businesses

Man walking up stairs thinking about the bounce back loan scheme

The UK government introduced the Bounce Back Loan Scheme (BBLS) as a lifeline for small and medium-sized businesses during the COVID-19 pandemic. In this article, we’ll explore the BBLS, its implications for struggling companies, and how insolvency practitioners like Company Doctor can help you navigate this challenging period.

A Brief Overview of the Bounce Back Loan Scheme

The BBLS allowed businesses to borrow between £2,000 and £50,000, with the government guaranteeing 100% of the loan. These loans were interest-free for the first 12 months and had a low-interest rate of 2.5% per year after that. However, as businesses now face the reality of repaying these loans, many are struggling and seeking professional advice.

The Impact on Companies Facing Insolvency

For some businesses, the BBLS provided temporary relief, but it could not prevent eventual financial difficulties. Companies with strike-off action suspended or those contemplating liquidation or administration should seek professional guidance. Company Doctor offers a range of services, including advice on closing a limited company and assistance with creditors’ voluntary liquidations.

Key Considerations for Struggling Businesses

  1. Redundancy Pay: Directors who are facing the liquidation of their businesses may be eligible for redundancy pay. Learn more about redundancy pay for directors and whether you can claim it.
  2. HMRC Debt Management: If your company has received a HMRC debt management letter, it is crucial to act quickly and seek professional advice.
  3. Director Loan Accounts: Understanding the implications of liquidation and director loan accounts is essential when dealing with insolvency.
  4. Order of Payment for Creditors: It’s vital to know the order of payment for creditors during company liquidation to ensure a smooth process.
  5. Energy Bill Relief Scheme: Assess how the energy bill relief scheme might affect your business during these challenging times.

“Remember, when facing insolvency, it’s crucial to seek professional advice. An insolvency practitioner can help you understand the best course of action and guide you through the process.” – Andrew Bowers

How Company Doctor Can Help

At Company Doctor, our experienced insolvency practitioners can provide tailored advice for your specific situation. We offer a wide range of services, such as:

If your business is struggling with the implications of the Bounce Back Loan Scheme, or if you’re facing insolvency, our team at Company Doctor is here to help. Contact us today to discuss your situation and explore the best options for your business.

Scroll to Top