£50,000 PGI approval on £500,000 CBILS loan required to support demand from COVID-19

£500k

Funding Amount 

£50k

Personal Guarantee Insured

£902k

Net assets

 

Type of Loan
CBILS Loan

The company specialises in commercial drug sourcing and supply for clinical research. As a result of the current climate, the business was experiencing a huge increase in demand for its services and they required a suitable funding line to ensure the business could fulfil its order book.

The company opted to utilise a £500,000 Coronavirus Business Interruption Loan "CBILS" given the attractive interest rates and the cash flow
advantages of the 12 month Business Interruption Payment paid on behalf of the company by the Government. As the CBILS loan value was in excess of £250,000, the bank was permitted to request a Personal Guarantee from the Director in support of the facility; the Director was put off completing on the facility due to this and he therefore applied for Personal Guarantee Insurance as a way to mitigate some of his personal risk.

The Purbeck underwriters were able to work with the Director to ensure he had a quote in place ahead of completion on the loan, giving the Director comfort to proceed with the finance to help his business grow.

Interesting facts about the case

• Despite the business having a record 6 months the bank still required the Director to sign a Personal Guarantee which was 10% of the overall facility.

• The Purbeck underwriters were able to issue a quote for purchase within 24 hours of the application.

• Personal Guarantees can be required in support of CBILS loans in excess of £250,000; this is at the discretion of the lender. However, recoveries are capped at a maximum of 20% of the outstanding balance following failure and after the proceeds of business assets have been applied.

Find out more

www.purbeckinsurance.co.uk

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