What documents do I need to apply for a CBILS loan?

What documents do I need to apply for a CBILS loan?

Guest blog post from Fluidly, our cashflow and funding partner.

If somebody had told you a year ago that you could take out a large unsecured loan with no interest or repayments for a year, you probably wouldn’t have believed them. But this crisis has turned traditional lending on its head.

Almost £20bn in government-backed CBILS loans were approved in 2020, helping thousands of businesses invest in stock and equipment, refinance or top-up existing loans, or simply give themselves a cash safety net.

But just like applying for a passport, a lender can’t process your application without the right documentation. In this article, we’re giving you everything you need to know about getting your documents in order, so you can take advantage of CBILS before it ends in March.

What documents do I need for a regular business loan?

First, it’s worth understanding what you need to apply for a normal business loan, as the same fundamental principles apply for CBILS. Although some requirements vary from lender to lender, there are at least two key documents that you need to collate and submit as part of the application process.

Lenders always need to see business bank statements and company accounts. These documents allow a bank to build a picture of your financial situation, so they can decide whether you’re likely to be able to pay the loan back.

How do I share my business bank statements?

It’s easier to apply for a mortgage if you can prove how much you earn. The same goes for business bank statements, which give lenders confidence in the regularity and amount of money moving in and out of your business.

There’s a couple of ways you can send your bank statements to a lender. You could manually export PDF versions of the statements yourself, by logging into your online banking, finding your statements and then downloading them. After that, you can attach the downloaded files to an email and share it that way.

But these days most lenders allow you to share your statements via Open Banking, which provides a simple and secure way to give providers access to your financial information. As Open Banking takes just a few clicks, it’s a lot faster and easier than exporting individual statements.

It’s best to supply 12 months of statements (to today’s date if you can) and to make sure there’s no days missing, which can slow down your application. Another thing to double-check is your account name, which should match your company name. If you’re not using Open Banking, make sure you supply a PDF version, rather than an image or a spreadsheet, that shows your sort code and full account number.

How do I share my company accounts?

Financial accounts are equally important, as lenders will want to gain an insight into the finer details of your company’s full financial year.

Your accounts include the balance sheet, which shows the value of everything your company owns, owes and is owed on the last day of the financial year. The other key statement is the profit and loss account, which shows the company’s sales, running costs and the profit or loss it has made over the financial year.

Sometimes a shortened, or ‘abbreviated’ set of accounts is filed at Companies House. However, lenders need a ‘full’ set to make a decision, so make sure you either send this across or request this information from your accountant.

If you’re working with a provider like Fluidly, which allows you to compare a range of options, we can also liaise directly with your accountant on your behalf.

How does it work with CBILS? What documentation is required?

CBILS works in a similar way to other business loans, but there are handful of criteria your business needs to meet in order to to apply for the scheme:

  • Be UK-based in its business activity
  • Have an annual turnover of no more than £45 million
  • Have a borrowing proposal which the lender would consider viable, were it not for the current pandemic
  • Self-certify that your business has been adversely impacted by coronavirus

Again, the most common requirement is a full set of financial accounts and the last 12 months of business bank statements. Some lenders may also require a cashflow forecast or business plan, but in our experience this is fairly unlikely with CBILS.

Ultimately, If you’re not sure what you need, it’s worth talking through with a specialist who can help you make most of your existing info.

Applying with Fluidly is easier than going directly to a lender, as we allow you to compare a range of options. We help you look at multiple lenders and get offers quickly – plus our dedicated team of funding specialists will work to get you the best deal.