The Coronavirus Business Interruption Loan Scheme (CBILS) deadline is creeping up on us. At present, businesses have until 31 March to start their application for a year of fee and interest-free funding. It’s an opportunity that we’ve never seen before and one that’s worth making the most of. Below we go through the ways you can use the money – as the economy starts to pick up again.

So, whether you're in survive or thrive mode, extra working capital that doesn’t cost you a penny for a year could do so much for your business.

Recovery might come sooner than expected

As we wait for the Prime Minister’s official update on lockdown measures next Tuesday, there seems to be a lot more to look forward to. The third lockdown has felt challenging as the weather and daylight made getting fresh air more of a chore than in summer. But things are starting to look up.

Over 15 million people have had their first dose of vaccine in the UK. Roll outs are underway across the world, and with the US fiscal stimulus package being voted through last month, economic markets globally are boosted. According to the Bank of England’s latest Monetary Policy summary, the speed we’re vaccinating at should mean a stronger bounce back in our economy this year from spring.

When can we expect things to get back to normal?

The government has said that the over 50s and most vulnerable people will be vaccinated by the end of May. On top of this, all working age adults look set to receive their jabs by September. Although the vaccine doesn’t offer a simple solution to all our problems – social distancing will likely stay in place for some time – it does offer hope. And hope means consumer confidence, which means a likely rebound imminently.

The way we relax and exit lockdown will influence recovery, of course. Most analysts are assuming that rules will be relaxed from April to September. With not long to go until then, right now is a critical time to think about how your business might be impacted. So ask yourself: what skills, tools and cash do I need to support my business? If you need cash to make those things happen, get your CBILS application in sharp.

How can I prepare financially?

You can get four different types of finance through CBILS: business loans, revolving credit, overdrafts and asset finance. Cash flow concerns are different for every business, so choosing the right kind for yours is an important decision. You can even combine two or more facilities, depending on your needs.

We’re CBILS-accredited and offer business loans as well as a revolving credit facility that lets you instantly access the cash in your unpaid invoices. Whether you’re looking for a quick cash injection or ongoing support, our instant quote tool will give you an idea of the amount you could borrow.

If you’re focusing on supporting your business and surviving, you can use CBILS to:

  • Consolidate your debt – this is a great opportunity to balance your books and stay cash positive. It will make you more attractive to lenders in the long run, boosting your chances of survival
  • Pay suppliers – a healthy relationship with them is crucial to future success
  • Pay salaries – your team is your most important asset so make sure they’re looked after
  • Pay rent – if you rely on warehouse space, factories or any other premises to run your business, not having to worry about where the funds are coming from to pay for them is huge relief

If you’re focusing on growth and boosting productivity, you can use a CBILS facility to:

  • Invest in assets – you might be looking for new property, plants or machinery to support an uptick in business
  • Hire employees or contractors – taking someone on who has the skills or capacity to help you manage your growth can help you sustain it. This could be freelance, temporary or permanent
  • Invest in marketing – with more competition online, and more new businesses being registered this year than last, you’ve got to make sure you’re heard amongst the noise. Without communicating properly with your target audience, you won’t see continued growth

What macroeconomic changes to prepare for:

Look beyond UK and EU markets

Stronger global growth is expected as vaccination drives gather pace. With Brexit impacting customs and EU deliveries, make sure you’re able to compete in a global market. Barclays boss Jes Staley has said the UK should focus on staying competitive outside Europe. That might mean exploring new manufacturing hubs, importing from new suppliers, or simply looking into new markets to enter. These things take good research, and crucially, healthy cash flow.

Prepare for negative interest rates

Europe is used to them, but the Bank of England has yet to vote them in. However, they’re not off the table. Negative interest rates will impact more than just savings. You want to make your cash work for you rather than sitting around in an account. Think carefully about what you need to survive or grow, and ask yourself what assets, talent and strategies you need to pay for. Being able to fund these things on zero interest for 12 months will make them easier to acquire.

Once-in-a-lifetime opportunity

Even if a CBILS facility just serves as a cash-buffer in case of a near future need with another lockdown or similar, it’s worth exploring. Paying nothing in fees and interest for a year is an opportunity we haven’t seen before, and who knows when we’ll see it again.

Bridging your gaps in cash flow and making sure you’re set up with adequate working capital will help you get through the global recovery.

For more information and advice on weathering the current storm, including which support schemes can be combined, head to our COVID-19 Impact Support Hub.