Recovery Loan Scheme

The recovery loan scheme is a solution for UK businesses looking to recover from the pandemic.

Businesses that already borrowed from other coronavirus loan schemes like those below were still able to take out the RLS loan.

The problem with all the business lending is now all the companies are needing to try to stay afloat and pay the interest rates.

It is very important to understand that some business loans can come with personal guarantees included.

If you are a company director that is being chased by RLS debt collectors for outstanding business finances, you need to act on the debts.

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Just ignoring the debts could cause issues for the business closure and also personal debts as the personal guarantee will make the director personally liable.

In our Recovery Loan Scheme Business Debts guide, we explain everything you need to know about repayments to RLS loans and if these debts can be legally written.

What is The Recovery Loan Scheme?

The Recovery Loan Scheme supports access to finance for UK businesses as they grow and recover from the disruption of the COVID-19 pandemic.

The government RLS scheme is open to businesses with a turnover not exceeding £45m per annum.

The maximum amount of business finance available will be £2 million per UK company (maximum amount per Group limited to £6m).

The RLS lending included term loans, overdraft, invoice finance and asset finance.

What is the interest rate on the recovery loan scheme?

The Recovery Loan Scheme interest rates are on average 6.16% per year for up to three years.

If a business wants to get business loans for over three years, the RLS interest rate jumps up to 7.06%.

Some businesses trying to recover from the pandemic are struggling to pay these interest rates and causing them to be in persistent debt, where the company has paid more in interest, fees and charges than they have towards paying off their RLS debts.

If your company is in a state of persistent debt get in touch today and speak with a business debt advisor on all your available options.

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What Lenders Offer the Recovery Loan Scheme?

Here are the following lenders for the Recovery Loan Scheme.

  • recovery loan scheme barclays
  • recovery loan scheme hsbc
  • recovery loan scheme lloyds
  • recovery loan scheme natwest
  • recovery loan scheme bank of scotland
  • recovery loan scheme co operative bank
  • government recovery loan scheme santander

Getting Advice on RLS Business Debts

If you are worried about RLS business debt issues around personal guarantees as a company director it is very important you seek professional debt advice.

Throughout the United Kingdom, there are many corporate financial advisors and insolvency specialists who offer free advice and support to business directors during difficult moments.

An RLS personal guarantee debt can become a source of real worry when a company’s financial position is such that creditors are calling in their debts and assets are being seized. For directors, having personal finances and assets become part of the corporate insolvency picture can be a nightmare scenario.

Get in touch today to speak directly to an insolvency and business rescue specialist. Offering free and independent advice, by phone or at your place of work or one of our UK offices could be one of the most valuable decisions you make.

Recovery Loan Scheme Personal Guarantee

The Recovery Loan Scheme does not contain directors’ personal guarantees.

If the loans are defaulted, and the firm is placed into some type of insolvency proceedings, the directors are not personally accountable.

Is the Recovery Loan Guaranteed?

This is not a grant programme. The system offers a lender with a guarantee, allowing them to provide credit, but businesses must still repay the loan.

Can’t Pay Recovery Loan Scheme Debt

The RLS offers finance of up to £2 million per company (up to £6 million per group). Asset and invoice finance requires a minimum facility size of £1,000, while term loans and overdrafts require £25,001.

There are term loans, revolving credit (overdrafts), asset financing, and invoice financing options available (depending on what type of financing the lender is accredited for).

If you have taken on a recovery loan scheme and are struggling to pay it back. Speak to a licensed business debt professional today to see what options are available to you.

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Term loans and asset finance are available for three months to six years, with overdrafts and invoice finance starting at three months and lasting up to three years. Businesses are responsible for paying interest and other fees linked to the facility.

Can Recovery Loan Scheme Debts Be Written Off?

What options do you have if your business is unable to repay its RLS? Although the government provides complete security for the Recovery loan scheme, the company is still responsible for repaying the amount borrowed.

If the firm becomes insolvent and enters a formal liquidation process, such as a CVL, the RLS will be effectively “written off.” Your debt will not be written off simply because you are unable to make your monthly instalments.

Struggling To Pay Business Debts

Here are some other business debt guides if you are struggling with different types of debts: