What was the eligibility criteria for a Bounce Back Loan?
Eligibility for a BBL was based on the following Scheme criteria:
Your business is a UK-based business trading as at 1 March 2020;
Your business has been negatively affected by Coronavirus (COVID-19);
You derive more than 50% of your income from your business trading activity;
You do not have, or have not already, applied for a Bounce Back Loan from TSB or another lender;
You can self-declare that your business is not a Business in Difficulty as at 31 December 2019 (or if it is, that you are not in breach of De Minimis State aid restrictions); is not in bankruptcy; debt restructuring proceedings; or in liquidation; and
You can self-declare that you are 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 be used to repay the whole of the CBILS, CLBILS or CCFF facility.
The following types of business were not eligible:
Credit institutions (falling within the remit of the Bank Recovery and Resolution Directive)
Public sector bodies
State-funded primary or secondary schools
Bounce Back Loans were not offered to Trusts, Clubs, Societies and Charities.
What is a Bounce Back Loan?
Bounce Back Loans were offered from 4 May 2020 to 31 March 2021 for businesses impacted by Coronavirus (COVID-19), who needed to borrow from £2,000 up to £50,000 (up to a maximum of 25% of the business’ annual turnover). There were no forward-looking tests of business viability or complex eligibility criteria to be met.
BBL’s had a 6-year fixed-term with the option to extend up to 10 years, no early repayment fees or charges and no arrangement fee;
For the first 12 months the interest was met by the Government through a Business Interruption Payment and borrowers were not required to make any repayments;
After the first 12 months until the end of the loan term a fixed interest rate of 2.5% per annum applied;
Borrowers are responsible for all repayments/debt;
Option for a capital repayment holiday (interest-only repayments for up to 6 months. Option could be used a maximum of three times over the term of the loan. The length of the loan would increase meaning more interest paid overall).
Borrowers could take a payment holiday for six months. This option was available once during the term of the Bounce Back Loan.
No personal guarantee or security was required;
The Government provided a 100% debt guarantee to lenders on these loans, but borrowers remain responsible for repaying their loan.
Further information can be found in this guide to Bounce Back Loans produced by UK Finance - an industry body who represent the finance industry.
How much will the loan cost?
For the first 12 months of your loan you won’t be charged any interest. After the first 12 months until the end of your loan term an interest rate of 2.5% p.a. will apply. There is no arrangement fee.
The table below shows some examples of loan repayments.
The total amount repayable excludes Business Interruption Payment (BIP), which TSB will receive from the Government to cover the first 12 months of interest.
First repayment amount* (month 13)
Total amount payable
Interest amount payable over the loan term
* We will send you a repayment schedule before your first repayment is due.
Borrowers could only have one Bounce Back Loan for their business. If a business was part of a group, only one loan was allowed per group. Two or more businesses that are under common ownership or control (including by the same individual or group of individuals) are considered to be a group;
Bounce Back Loans are not subject to the usual consumer protections that apply to business lending. This means you won’t have the benefit of the protection that would otherwise be available to you under the Financial Services and Markets Act 2000 or the Consumer Credit Act 1974 (if applicable);
Borrowers weren’t able to have a CBILS overdraft and a Bounce Back Loan at the same time.
If you do not repay your Bounce Back Loan it could negatively impact your credit score or rating with credit reference agencies and make it harder to get credit in the future;
If you have taken out a Bounce Bank Loan with us, we will pay due regard to your information needs and we will provide information to you in a way which is clear, fair and not misleading;
To find out how you can make a complaint to TSB see our Managing Debt page. You’ll also find details there about how you can contact the Financial Ombudsman Service for complaints we’re unable to resolve.
We will provide you with the following information about your Bounce Bank Loan:
A statement (at least annually), setting out details of payment transactions on your Bounce Bank Loan during the time since such information was last provided (or the date that you received funds under the loan, if no information has been provided previously) and amounts outstanding under the Bounce Bank Loan;
If you miss a repayment on your Bounce Back Loan we will provide timely, clear and adequate information to ensure you understand the amount you have missed, what can be done to remedy it, when you need to make any missed payments by, and how this could affect your future repayments;
If you default on your Bounce Bank Loan, we will provide you with information about any proposed action we might take, before we take it; and
The options available to you for help and assistance, including sources of free independent advice.
We will also:
Pay due regard to your information needs and provide information in a way which is clear, fair and not misleading;
Monitor repayments that you make during the life of your Bounce Bank Loan and take action to help you where there are signs of actual or possible repayment difficulties;
Make adjustments to ensure that your circumstances are accommodated throughout the duration of your Bounce Back Loan, if we identify or believe you are vulnerable;
Give you a reasonable period of time to remedy any breach if you default on your Bounce Back Loan. We will not treat the default as an event of default if you remedy the default within the period of time we give you;
Not charge you any fees in relation to your Bounce Back Loan (including on default) or any default interest (except that we may continue to charge interest at the rate of 2.5% per annum if your Bounce Back Loan is not repaid when due until such time as it is repaid).
To find out how you can make a complaint to TSB visit our Managing Debt page . You’ll also find details there about how you can contact the Financial Ombudsman Service for complaints we’re unable to resolve.
Q. What affect will this have on my BBL facility? A. There is no change to your facility held with TSB.
Q. Will this affect my Pay As You Grow options? A. No, this is a notification and will not affect your facility, including Your Pay As You Grow options.
Q. Why was I not advised of this when I took out my BBL facility? (See answer below) Q. If I repay my loan, will my data still be shared? (See answer below) Q. I have already repaid my BBL facility, why am I receiving this letter? (See answer below) Q. Why is my data being reported to the European Commission? (See answer below)
Managed by the British Business Bank on behalf of, and with the financial backing of, the Secretary of State for Business, Energy & Industrial Strategy. British Business Bank plc is a development bank wholly owned by HM Government. It is not authorised or regulated by the PRA or the FCA. Visit british-business-bank.co.uk.