Gloucestershire law firm Willans LLP has put together a fixed-price legal support package to help guide and advise SMEs applying for assistance under the Coronavirus Business Interruption Loan Scheme (CBILS).
The government scheme has thrown a much-needed lifeline to businesses experiencing cashflow difficulties as a result of the coronavirus outbreak. The eligibility criteria of CBILS was relaxed on 3 April 2020 to enable more businesses (where annual turnover doesn’t exceed £45m) to access the funding during a time of need, through one of over 40 accredited lenders across the UK.
Under the scheme, finance of up to £5m is available for eligible businesses, with interest and fees absorbed by the government for 12 months. There are no guarantee fees for SMEs (the lender pays a fee to access the scheme) and guarantees are offered to the lender to encourage them to lend. However, the borrower will still have to fund all fees and interest after the initial 12 month-period.
Over the last few weeks banks have been flooded with applications. But amid this increased sense of urgency, businesses should approach this scheme with the same degree of caution as they would with any other loan facility, says corporate & commercial partner Chris Wills of Willans LLP.
“Without the government scheme, it’s no secret that a significant number of SMEs would find themselves in financial difficulty due to these unprecedented market conditions. Although taking advantage of the scheme may seem a ‘no-brainer’ to many businesses, it’s arguably more important than ever for businesses to understand the small print; you don’t want to be tripped up by your own safety net.
“While it can be tempting to rush through the application as demand on lenders snowballs, we’ve been approached by new and existing clients over the past few weeks for advice on the terms of these loans and the liabilities they may be facing. It’s great that so many organisations are being assisted by the scheme, but it is also encouraging to see businesses wanting to be fully prepared and informed before signing on the dotted line.”
With this in mind, Chris and the Legal 500-rated corporate & commercial team at Willans have put together a fixed-price legal support package to help businesses who are going through the application process, which covers checking loan and security agreements and advising on liabilities.
Chris added “Whether you are looking for advice on how on protecting your business while accessing the Coronavirus Business Interruption Loan Scheme, or on how to handle contracts with customers and suppliers (including how to cancel orders, terminate or enforce contracts or amend their terms), force majeure, or have employment-related queries or need help with handling a business dispute, our multi-disciplinary team of lawyers can support you during this tricky time.”
Willans is also regularly updating its website with more COVID-19 legal insights, so keep an eye on willans.co.uk/covid19/ for the latest legal perspectives relating to the coronavirus.