Funding Circle to expand into bounce back loans
Funding Circle is preparing to expand its participation in the government’s emergency funding schemes to offer bounce back loans (BBL) alongside coronavirus business interruption loans.
The peer-to-peer lender was the first in the sector to be accredited for the coronavirus business interruption loans scheme (CBILS) and has taken up an offer from the British Business Bank to expand into BBL.
Funding Circle started accepting applications for CBILS on 30 April.
It is offering rates of between 1.4 per cent and 8.9 per cent APR for between two and five years.
The platform added the option to register for updates on the BBL scheme this week and a statement on its website said it is working on becoming a provider.
The rate will be 2.5 per cent for a term of six years.
“BBL loans are a good option if you want to borrow up to £50,000,” the platform said.
“However, if you want to borrow more, either now or in the future, a CBILS loan could be a better option.”
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Businesses cannot take out finance under both BBL and CBILS but it is possible to refinance from one to the other.
“If you have a CBILS loan, you can apply for BBL if you then refinance the CBILS loan in full,” Funding Circle said.
“All accredited providers who have approved CBILS loans so far will allow customers to refinance their loan into the BBL scheme where appropriate.
“However, borrower protections under these schemes differ and businesses should discuss these with their lender.
“Similarly, if you have a loan under the BBL scheme already, it is possible to get a CBILS loan if you refinance your original loan.
“However, this is not guaranteed as there are limits on the amount of refinancing that any lender can provide under CBILS.”