Large businesses will be able to apply for loans worth up to £200m from next week as part of the latest changes to the government’s coronavirus support package.
The Treasury has increased the maximum amount that can be borrowed through the coronavirus large business interruption loan scheme (CLBILS) from £50m to £200m.
The expanded loans, which have been introduced following discussions with lenders and business groups, will be available from 26 May.
Companies borrowing more than £50m through CLBILS will also be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan, including a ban on dividend payments and cash bonuses, except where they were previously agreed.
The move was welcome by Stephen Jones, chief executive of banking trade body UK Finance.
“Ensuring businesses of all sizes access the financial support they need during these tough times is a common goal shared by government, banks and regulators,” he said.
“The banking and finance industry welcomes the Treasury’s reforms to CLBILS, extending the maximum loan size available from £50m to £200m to help support larger business affected by coronavirus alongside the Bank of England’s Coronavirus Corporate Financing Fund (CCFF).
“Over the past seven weeks, the industry has worked tirelessly to get money to those viable businesses that need help with firms and sole traders of all shapes and sizes accessing billions of pounds in loans.”