What is the difference between a CBILS Loan and a Bounce Back Loan?

Paul Elliott31 July 2020

Running an SME is tough; then 2020 came along. We see businesses working tirelessly, dealing with the challenges of COVID today, whilst trying to adapt and plan for the future. So, if you’re an SME, you’re likely to have a lot of questions right now.

Well we can help take a couple of things off your list. Paul Elliott, Head of Business Banking at Atom, is here to answer your Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back Loan Scheme (BBLS) queries. Maybe you’re wondering if you can get a Bounce Back Loan and a CBILS loan? Perhaps you want to know the differences? Maybe you want to find out how to apply? Let’s break it down.

The basics

  • BBLS and CBILS are two separate schemes which offer differing features and benefits.

  • Coronavirus Business Interruption Loan Scheme (CBILS) is a Government-backed scheme which means lenders, like Atom, can provide loans of up to £5m to SMEs if you’ve experienced lost or deferred revenues, leading to disruptions in your cash flow, because of COVID-19.

  • Bounce Back Loan Scheme (BBLS) is Government-backed too. This scheme helps small and medium-sized businesses who have been adversely impacted by coronavirus borrow between £2,000 and up to 25% of their turnover. The maximum loan is £50,000.

Atom’s CBILS loansBBLS
You CAN apply if your business:
Atom’s CBILS loans
  • Is UK-based in its business activity
  • Is an SME with an annual turnover of no more than £45 million
  • Has a borrowing proposal which Atom would consider viable subject to the facility helping with short and medium term cash flow difficulties
  • Can self-certify that it has been adversely impacted by COVID-19
  • Can provide suitable security for a secured loan in line with Atom’s commercial lending policy
  • Can generate more than 50% of its turnover from trading activity
  • Has not been classed as a “business in difficulty” on 31 December 2019 and is not subject to any current collections or insolvency proceedings.
  • Is not using the Coronavirus Bounce Back Loan Scheme (BBLS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) or the Bank of England’s Covid Corporate Financing Facility Scheme (CCFF), unless the Bounce Back Loan will refinance the whole of the BBLS, CLBILS or CCFF facility
BBLS
  • Is UK-based in its business activity.
  • Is engaged in trading or commercial activity in the UK and was established by 1 March 2020
  • Does not already have a Bounce Back or CBILS loan (or in the process of applying for one with another lender) though you can convert an existing CBILS loan to a BBLS loan.
  • Can self-certify that it has been adversely impacted by COVID-19
  • No security required
  • Can generate more than 50% of its income from its trading activity
  • Has not been classed as a “business in difficulty” on 31 December 2019 and is not subject to any current collections or insolvency proceedings.
  • Is not using the Coronavirus Business Interruption Loan Scheme (CBILS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) or the Bank of England’s Covid Corporate Financing Facility Scheme (CCFF), unless the Bounce Back Loan will refinance the whole of the CBILS, CLBILS or CCFF facility.
You CAN’T apply if you are
Atom’s CBILS loans
  • A bank, building society, insurer or reinsurer (but insurance brokers can apply)
  • A public-sector body or state funded primary or secondary school.
BBLS
  • A bank, building society, insurer or reinsurer (but insurance brokers can apply)
  • A public-sector body or state funded primary or secondary school.
How much can you borrow?
Atom’s CBILS loans
  • Atom offers secured business loans from £100,000 to £5m.
BBLS
  • You can borrow from £2,000 up to 25% of a business’ turnover with a max loan size of £50,000.
What are the repayment terms?
Atom’s CBILS loans
  • Up to six years but early payment is allowed, without early repayment fees.
BBLS
  • Six years but early payment is allowed, without early repayment fees.
Can you refinance debt from another lender?
Atom’s CBILS loans
  • Yes
BBLS
  • Yes
Do you start repaying capital straight away?
Atom’s CBILS loans
  • Depends on the lender. Atom offer CBILS customers the option to take a capital payment holiday for the first 12 months
BBLS
  • The borrower does not have to make any capital repayments for the first 12 months. The government will pay the first 12 months of interest
What are the fees?
Atom’s CBILS loans
  • Set up fees (legals, valuations and arrangement fee) can be reimbursed by the Government through a Business Interruption Payment.
BBLS
  • Atom doesn't offer Bounce Bank loans, [but you can find out more info about who does from the British Business Bank.
    There are no fees for taking a Bounce Back Loan.
What’s the interest rate?
Atom’s CBILS loans
  • The interest rate is set by Atom.
    The first 12 months of interest can be reimbursed by Government if you choose to receive a Business Interruption Payment (BIP).
    After those initial 12 months, the agreed interest rate is applied.
BBLS
  • The interest rate is set at 2.5% by the Government. The government will pay the first 12 months of interest
Do you have to be an Atom customer to get the loan?
Atom’s CBILS loans
  • Of course not! We accept applications from new and existing customers.
BBLS
  • We don’t offer Bounce Back Loans, but you can find out more info about who does.

Table information correct at time of publishing at 23.07.20

Atom only offer CBILS loans, but we want to make sure you get the right loan for you and your business. What’s in it for us? You knowing we do the right thing for SMEs, even if that means you getting a loan with someone else. SMEs help power our economy and we want to do what we can to help you.

If you want a Bounce Back loan, you can start here.

If you want a CBILS loan you can get started with us now - we’ll put you in touch with a range of brokers who will kick start the process for you straightaway.

Find a CBILS broker