Mid-sized and larger businesses with a turnover of more than £45m will be allowed to access funding through a new Government scheme from Monday, according to the British Business Bank.
Chancellor Rishi Sunak said companies can apply for the loans from lenders accredited by the banking group, through the Coronavirus Large Business Interruption Loan Scheme (CLBILS).
Bosses with sales between £45 million and £250 million can apply for the short-term loans and financial support of up to £25 million if they have been forced to shut down operations or been impacted by the virus shutdown.
Larger businesses with sales of more than £250 million can also take the support.
However, if they access CLBILS they will be unable to use the Bank of England’s Covid Corporate Financing Facility (CCFF), which EasyJet and Greggs have both borrowed from.
Mr Sunak, said: “I want to ensure that no viable business slips through our safety net of support as we help protect jobs and the economy. That is why we are expanding this generous scheme for larger firms.
“This is a national effort and we’ll continue to work with the financial services sector to ensure that our £330 billion of government support, through loans and guarantees, reaches as many businesses in need as possible.”
Business Secretary Alok Sharma added: “Coronavirus has struck a heavy blow against businesses of all sizes across the UK.
“Expanding this scheme will provide larger firms with the support they need during the pandemic, helping to provide job security to thousands of people and protect our economy.”
With the lockdown extension stretching for another three weeks at least, businesses are keen to ensure they can remain solvent until the economy can return to normal.
The Government said the new loans would be 80% guaranteed by the state and explained banks must not ask for personal guarantees on any loans under £250,000.
For anything above, the Government said: “claims on personal guarantees cannot exceed 20% of losses after all other recoveries have been applied.”
Keith Morgan, chief executive of British Business Bank, said: “The new Coronavirus Large Business Interruption Loan Scheme focuses on a relatively narrow area of the market, but one that is vitally important to the UK economy.
“More finance for viable mid-sized and larger firms will help them protect jobs and be in a better position to resume normal business when the current pandemic subsides.”