Breathing space for businesses with bounce back loans

Businesses that took out loans under the bounce back loan scheme (BBLS) will have more time and flexibility to repay them the Treasury has announced.

More than 1.4 million businesses took out nearly £45bn through the scheme which is run by the British Business Bank. Lenders are expected to offer pay-as-you-grow (PAYG) options to all borrowers under the scheme.

Under PAYG businesses that took out a bounce back loan will be able to pause repayments for up to six months. This will be available from the first repayment rather than after six repayments have been made. Since no repayments or interest are due under the scheme during the first 12 months of the loan term this new measure gives businesses the option to make no payments on their loans until 18 months after they took them out.

Businesses will also be able to...