Recovery Loan Scheme (RLS) calculator

Recovery Loan Scheme (RLS) calculator

The UK Government’s Recovery Loan Scheme (RLS) aims to support UK businesses as they recover from the COVID-19 pandemic, with lending of up to £2m. The scheme now runs until June 2024. Are you eligible?

Ian Hawkins

Page written by Ian Hawkins. Last reviewed on June 21, 2024. Next review due April 6, 2025.

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How does the RLS scheme work?

The Recovery Loan Scheme is a government-backed initiative aimed at providing financial support to businesses affected by the COVID-19 pandemic. The scheme was launched in April 2021 to replace the previous Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back Loan Scheme (BBLS).

Under the Recovery Loan Scheme, businesses can apply for loans ranging from £25,000 up to a maximum of £2 million. These loans are designed to help businesses that have been adversely affected by the pandemic, such as those that have had to close or reduce their operations due to government restrictions.

The loans are available through a network of accredited lenders, including banks, building societies, and specialist lenders. The government provides an 80% guarantee to lenders, which means that if a borrower defaults on their loan, the government will cover 80% of the outstanding debt.

Businesses can use the loans for a variety of purposes, including working capital, investment in equipment or machinery, and refinancing existing debt. 

To apply for a loan under the Recovery Loan Scheme, businesses will need to demonstrate that they have been adversely affected by the pandemic and provide evidence of their financial viability. They will also need to provide a business plan and cash flow forecast to demonstrate that they can repay the loan.

Important note: On July 1st, 2024 RLS will be replaced by the Growth Guarantee Scheme. Find out more here.

What are the rates on the recovery loan scheme?

The interest rates and repayment terms will vary depending on the lender, but the government has set a maximum interest rate of 14.99% for the loans.

How do I calculate my monthly RLS payments?

First, you will need to determine the interest rate on your loan, which will depend on the lender you choose and your creditworthiness. The interest rate is typically expressed as an annual percentage rate (APR). For example, if your loan has an APR of 10%, you will be charged 10% of the outstanding balance each year.

Next, you will need to consider the repayment term, which is the length of time over which you will repay the loan. The repayment term will depend on the lender and the purpose of the loan. For example, loans for working capital may have a shorter repayment term than loans for investment in equipment or machinery.

Once you have determined the interest rate and repayment term, you can use our loan repayment calculator to estimate your monthly repayments. You will need to enter the loan amount, interest rate, and repayment term into the calculator to get an estimate of your monthly repayments.

Keep in mind that the actual amount of your monthly repayments may vary depending on the lender’s specific terms and conditions. It’s always a good idea to read the loan agreement carefully and speak to your lender if you have any questions or concerns.

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