Skip to main content
Helping your business to Start, Grow and Develop.

Search

For a successful business, you need a viable business idea, the skills to make it work and the funding. Discover whether your idea has what it takes.

Forming your business correctly is essential to ensure you are protected and you comply with the rules. Learn how to set up your business.

Advice on protecting your wellbeing, self-confidence and mental health from the pressures of starting and running a business.

Learn why business planning is an essential exercise if your business is to start and grow successfully, attract funding or target new markets.

It is likely you will need funding to start your business unless you have your own money. Discover some of the main sources of start up funding.

Businesses and individuals must account for and pay various taxes. Understand your tax obligations and how to file, account and pay any taxes you owe.

Businesses are required to comply with a wide range of business laws. We introduce the main rules and regulations you must comply with.

Marketing matters. It drives sales and helps promote your brand and products. Discover how to market your business and reach your target customers.

Some businesses need a high street location whilst others can be run from home. Understand the key factors from cost to location, size to security.

Your employees can your biggest asset. They can also be your biggest challenge. We explain how to recruitment and manage staff successfully.

It is likely your business could not function without some form of IT. Learn how to specify, buy, maintain and secure your business IT.

Few businesses manage the leap from start up to high-growth business. Learn what it takes to scale up and take your business to the next level.

"Breathing space" for 1.4 million firms with Bounce Back Loans

9 February 2021

Chancellor Rishi Sunak has announced new flexible repayment options for more than one million businesses that have taken out Bounce Back Loans during the pandemic.

The new repayment terms - billed as Pay as You Grow (PAYG) - will be available to over 1.4 million businesses, which collectively took out nearly £45 billion through the Bounce Back Loan Scheme. PAYG will allow borrowers to tailor payments according to their individual circumstances.

Under the original Bounce Back Loan Scheme terms, no repayments or interest are due from the borrower during the first 12 months of the loan term. With this new support, businesses will now be able to:

  • extend the length of their loans from six to ten years (reducing monthly repayments by almost half)
  • make interest-only payments for six months
  • or pause repayments for up to six months

The chancellor has also extended the flexibility of the third option, which will now be available to all from their first repayment, rather than after six repayments have been made. It means that businesses can choose to make no payments on their loans until 18 months after they originally took them out.

The government says that lenders will proactively reach out to borrowers to provide information on repayment schedules and explain how to access flexible repayment options.

"Businesses are continuing to feel the impact of extended disruption from COVID-19, and we're determined to give them the backing and confidence they need to get through the pandemic," said chancellor of the exchequer Rishi Sunak. "That's why we're giving Bounce Back Loan borrowers breathing space to get back on their feet, through greater flexibility and time to repay their loans on their terms."

However, Funding Xchange has warned that although the new support will help many firms, others will still struggle to repay their loans. In fact, its analysis suggests that more than half of the 1.4 million Bounce Back loans made will be unaffordable.

Funding Xchange is a government-approved online referrals platform for businesses looking for alternative finance when their main banks have declined their loan application. The platform captures data and uses open banking functionality to forecast the capacity of businesses to be able to service their borrowings.

"Extending the repayment period from six years to ten years will have a positive impact on around one in five of the businesses," said Katrin Herrling, co-founder and ceo of Funding Xchange. "We still forecast that more than half of the businesses who have used the scheme may be unable to repay. Many are already distressed and the 46% of borrowers who had no prospect of being able to repay anyway will still not be able to repay."

At the moment, Funding Xchange data suggests up to two-thirds of businesses with Bounce Back Loans are experiencing repayment stress. "Several other nations are implementing debt forgiveness scheme for distressed businesses - we encourage the government to carefully examine these alternative solutions that might offer better value to taxpayers, businesses and banks," said Herrling.

Written by Rachel Miller.

Stay up-to-date with business advice and news

Sign up to this lively and colourful newsletter for new and more established small businesses.