Grants and Loans to help British SMEs

Grants and Loans to help British SMEs

The Chancellor of the Exchequer Rishi Sunak introduced several measures to support small and medium businesses in Britain. There are 5.9 million SMEs in the UK that accounts for 99% of all companies. Their number was steadily growing from 2000. It is critical time now that will define how many will stay in business after 2020. The majority of companies work in the construction or the services sectors. Together they form about one-third of the employment in the country. How can SMEs access the support package the government offered?


£12.3bn handed to local authorities in England has to be distributed as grants to SMEs. The eligible SME has to be affected by the coronavirus crisis. There are two effective schemes in place: Retail, Hospitality and Leisure Grant Fund, and Small Business Grant Scheme. Only one grant can be paid per business premise. If your business has many outlets, you can receive grants from separate local authorities.

Since these support packages are grants and not loans, you do not have to pay back the money. However, the grant money will be added to your income and taxed accordingly.

Small Business Grant Scheme

This scheme is for all businesses with a rateable value below £15000. The programme gives a one-off grant of £10000 to cover ongoing expenditures.

Retail, Hospitality and Leisure Grant Fund

If your business is based in England and provides services in hospitality, leisure and retail sectors, has a rateable property value between £15000 and £51000, you can receive the £25000 grant. The government advises firms with relevant insurance policies that cover pandemics to claim them instead.

You have to apply to the local authority, and check your eligibility with it. Both schemes are open.


At the moment there are three loan schemes for businesses: the Coronavirus Business Interruption Loan Scheme (separate for smaller and larger companies), the Bounceback Loan Scheme and the COVID Corporate Financing Facility from the Bank of England.

Coronavirus Business Interruption Loan Scheme

If your company has less than £45M in turnover, it can access up to £5M in finance under this scheme. The government guarantees up to 80% on loan and covers loan fees as well as interest payments for the first 12 months. There are separate rules for larger companies under this scheme. You can apply through more than 40 accredited lenders listed on the British Business Bank website.

Bounceback Loan Scheme for SMEs provides 100% government-backed loans worth 25% of the company turnover with a £50000 cap. No repayments requested during the first 12 months. There will be a standardised online application available since 4 May to access this loan facility.

The COVID Corporate Financing Facility targets large companies enjoying a high credit rating but facing cashflow problems.

Oracle Capital Group helps its clients with impartial advice on access to emergency grants and loans.

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