Social Investment Business: Resilience & Recovery Loan Fund

Covid 19 Loans

The Resilience & Recovery Loan Fund (RRLF) is a new fund for social enterprises and charities that are improving people’s lives across the UK who are experiencing disruption to their normal business model as a result of COVID-19. 

RRLF is intended for those organisations who face a problem because expected income and activity has been delayed or disrupted. A loan of between £100,000-£500,0000 may help with this, providing working capital until normal business can commence again.

Purposes that are included:

  1. Lending until government payments are received (e.g. contracts, furlough etc).
  2. Lending to cover delays in trade payments (trade debtors).
  3. Lending to support the rapid scaling up of an existing business model to meet an increased demand for services during the crisis.
  4. Lending to provide a bridge to cover revenue shortfall for proven and profitable trading activity. Trading or retail models that rely heavily on footfall / shared office space that are likely to continue to be affected by social distancing are unlikely to be suitable/prove viability. (If you work within these models (trading/ retail heavily reliant on footfall/ shared office space), but were profitable prior to COVID-19, and feel you can demonstrate viability, you can apply.)
Term:A minimum of 1 year and a maximum of 3 years
Interest fee:9% per annum interest rate charged for the first twelve months to reflect the higher risk to the fund during the capital repayment holiday
(covered by Government and no charge to the borrower)

6.5% per annum for years 2 and 3 (after principal payments start)Interest calculated on the declining outstanding balancePayable quarterly in arrearsDefault interest rate 

2.5% above the fixed rate to reflect the higher risk of no capital repayments in line with the initial period
Arrangement fee:4% on the value of the loan (covered by Government and no charge to the borrower)
Drawdown:Full amount drawn down on signingNo redrawing of repaid amounts
Repayment:Capital repayment holiday for 12 months. Amortised quarterly repayments in equal instalments commencing 12 months from drawdown
Prepayment:Permitted at any time without penalty
Security:All loans of under £250k will be provided unsecured.

For loans of £250k and over security will be taken in the form of a standard fixed and floating charge, where readily available with exceptions made only in exceptional circumstances.

Loans do not work for every organisation. Please read the application guidance carefully before applying.

Deadline: Continuous rolling programme.

For more information and how to apply please click here.

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