Search British Business Bank
Popular Search placeholder

Budget 2021: British Business Bank Response

Press release 03 March 2021

At today’s Budget the Chancellor announced two new programmes to support businesses, which will be delivered by the British Business Bank.

The Chancellor has confirmed the British Business Bank’s central role in the next phase of the UK’s economic recovery from Covid-19. As businesses begin to plan for the post-Covid period, they will need targeted finance to support them. We welcome today’s announcement of two new schemes, one to provide debt finance to a broad range of businesses, and the other to invest equity alongside the private sector in fast growing innovative firms. Both schemes will help drive the innovation and growth needed to support the UK’s long-term prosperity. - Catherine Lewis La Torre Chief Executive, British Business Bank

The announcements are:

Recovery Loan Scheme

The Recovery Loan Scheme will launch on 6 April 2021, following the closure of the current Covid-19 debt schemes – the Coronavirus Business Interruption Loan Scheme (CBILS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Bounce Back Loan Scheme (BBLS) – on 31 March 2021. The Recovery Loan Scheme is scheduled to run until 31 December 2021, but this is subject to review.

The new scheme aims to help businesses affected by Covid-19 and can be used for any legitimate business purpose, including managing cashflow, investment and growth. It is designed to appeal to businesses that can afford to take out additional debt finance for these purposes.

Details of the scheme include:

  • Up to £10m facility per business: The maximum value of a facility provided under the scheme will be £10m per business. Minimum facility sizes vary, starting at £1,000 for asset and invoice finance, and £25,001 for term loans and overdrafts.
  • Turnover limit: There will be no turnover restriction for businesses accessing the scheme.
  • Wide range of products: Businesses will be able to choose from a variety of products: term loans, overdrafts, asset finance and invoice finance facilities.
  • Term length: Term loans and asset finance facilities are available for up to six years, with overdrafts and invoice finance available for up to three years.
  • Interest and fees to be paid by the business from the outset: Businesses will be required to meet the costs of interest payments and any fees associated with the facility.
  • Access to multiple schemes: Businesses who have taken out a CBILS, CLBILS or BBLS facility will be able to access the new scheme, although the maximum they are allowed to borrow will depend on their lender’s assessment and scheme requirements.
  • Credit checks for all applicants: Lenders will be required to undertake credit and fraud checks for all applicants. When making their assessment, lenders may overlook concerns over short-to-medium term performance owing to the pandemic. The checks and approach may vary between lenders.

Further information on the Recovery Loan Scheme will be made available on the British Business Bank website.

Future Fund: Breakthrough

Future Fund: Breakthrough, which will launch in early Summer 2021, is a new £375m scheme that will encourage private investors to co-invest with government in high-growth innovative firms. These R&D intensive companies accelerate the deployment of breakthrough technologies which can transform major industries, develop new medicines, and support the UK transition to a net zero economy.

Due to high research and development costs, breakthrough technology companies typically require more capital than other companies to fuel the later stages of their growth. Future Fund: Breakthrough will target R&D intensive companies seeking a minimum of £20m and will crowd in private sector investment to support their growth.

Future Fund: Breakthrough will be delivered by the British Business Bank, via its commercial subsidiary British Patient Capital. Further information is available on the British Business Bank website.

Notes to editors

About the British Business Bank

The British Business Bank is the UK government’s economic development bank. Established in November 2014, its mission is to make finance markets for smaller businesses work more effectively, enabling those businesses to prosper, grow and build UK economic activity. Its remit is to design, deliver and efficiently manage UK-wide smaller business access to finance programmes for the UK government.

The British Business Bank’s core programmes support nearly £8bn 1  of finance to almost 94,800 smaller businesses 2 . Since March 2020, the British Business Bank has also launched four new Coronavirus business loan schemes, delivering almost £73bn of finance to around 1.6m businesses.

As well as increasing both supply and diversity of finance for UK smaller businesses through its programmes, the Bank works to raise awareness of the finance options available to smaller businesses. The British Business Bank Finance Hub provides independent and impartial information to businesses about their finance options, featuring short films, expert guides, checklists and articles from finance providers to help make their application a success.

In light of the coronavirus pandemic and EU Exit, the Finance Hub has expanded and it now targets a wider business audience. It continues to provide information and support for scale-up, high growth and potential high growth businesses, but now provides increased content, information and products for businesses in survival and recovery mindsets. The Finance Hub has been redesigned and repositioned to reflect this, during this period of economic uncertainty.

British Business Bank plc is a public limited company registered in England and Wales, registration number 08616013, registered office at Steel City House, West Street, Sheffield, S1 2GQ. It is a development bank wholly owned by HM Government. British Business Bank plc and its subsidiaries are not banking institutions and do not operate as such. They are not authorised or regulated by the Prudential Regulation Authority (PRA) or the Financial Conduct Authority (FCA). A complete legal structure chart for the group can be found at british-business-bank.co.uk.

Quick links

Latest news