Businesses that took out a Bounce Back Loan to support their business during the pandemic received a 12 month repayment holiday. The interest during this period was paid for by the Government via a Business Interruption Payment.
This page is to help you start planning for your repayments when your repayment holiday ends. It also includes information about what additional support is available to you.
When will my monthly repayments begin?
Your repayments will begin 12 months after you took out your Bounce Back Loan.
How much will I repay?
Your repayments will include the amount you borrowed, plus interest from the date your repayment holiday ends.
Note that we calculate interest daily on the balance you owe, and you’ll pay this monthly at the same time as your capital repayment.
How will I make the repayments?
We’ll automatically collect your repayments using the payment details set up when you opened your loan. If your payment details have since changed, please let us know.
You’ll pay less interest if you pay back early.
If you no longer need the loan, you can choose to pay it back early. You’ll then pay less interest. There are no early repayment charges and you won’t pay any interest if you pay the full amount before the date your existing repayment holiday ends. Or you can make a one-off repayment, as well as additional payments on a regular basis, and doing so will also help save you money on your interest payments.
If you have other borrowings, you may want to think about repaying them before making additional payments to your Bounce Back Loan.
Your other repayment options
The Government has announced Pay As You Grow options for Bounce Back borrowers to help businesses get back to regular trading. Pay As You Grow could give you more time and flexibility to pay back your loan. Using these options won’t affect your credit score, though it may influence how we assess your creditworthiness in the future and your loan may cost you more overall. The options available to you – which can also be combined – are as follows:
1. If you expect to be in a better position to repay in the future:
You could reduce your monthly repayments for six months by paying interest only.
- On a loan of £50,000 this would reduce monthly payments from approximately £889 to approximately £104 during the six month period.
- The total amount you owe will go up. This is because your interest costs increase as a larger amount of your loan is outstanding for longer.
- This option is available up to three times during the term of your Bounce Back loan.
You could take a payment holiday for six months.
- You’ll make no capital repayments or interest payments during this time.
- The total you owe will go up. This is because your interest costs increase as interest accrues during the payment holiday and a larger amount of your loan is outstanding for longer.
- This option is available once during the term of your Bounce Back Loan.
2. If you’re only able to repay a smaller amount each month:
You could request an extension of your loan term from six years to ten years at the same interest rate of 2.5%.
Extending to 10 years would reduce monthly payments of £50,000 from approximately £889 to approximately £518.
You'll accrue more interest, so the total amount repayable would increase, unless you repay early.
If you’re considering this option, you should think carefully about your ability to repay over a longer timeframe, taking into account such things as if you intend to cease trading or retire within the revised term of your Bounce Back Loan.
You can use options 1 and 2 together if you need to. Both interest only and payment holiday options will be available throughout the course of your loan term.
Choosing your Pay As You Grow option
If you would like to apply for one of the above options, or have any further questions, please call our Bounce Back Loan team directly on 0330 828 1858, email firstname.lastname@example.org or fill out the contact form below. Following this, you will be sent a PAYG amendment letter to sign to confirm your agreement to taking this PAYG option.
Your PAYG option will take effect from your next repayment date as long as you sign the PAYG amendment letter more than 5 working days before your next repayment is due. If you choose your option within 5 working days of your next repayment date, your next repayment will be taken as scheduled and your PAYG option will be applied from the following month.
Here to help
If you have any questions, or you're worried about your finances and how you're going to repay, please contact your relationship manager, who will be happy to help.
You can call our specialist Bounce Back Loan team directly on 0330 828 1858. Alternatively, email email@example.com, or use the contact form below.
You can also contact the following organisations for free advice:
In addition, there's a range of guidance and resources about managing debt available to all businesses through the British Business Bank.
Bounce Back Loan terms & conditions
When you applied for your Bounce Back Loan, you declared that you understood that:
- You‘re fully liable for all repayments, and if you’re unable to meet these obligations, this could negatively affect your credit score.
- The 100% government guarantee is provided to cover any losses the lender makes and does not cover any losses that you might suffer if you‘re unable to meet your payment obligations.
- We would not carry out any affordability checks on your application.