At ScotlandIS, we are starting the 4th week of homeworking and it begins to feel like the new normal. Part of this are also our regular updates for you on COVID-19 news that are of relevance to Scotland’s digital technologies sector. This time, we’ve got an innovation grant, furlough clarifications and updates on business loans and export insurance for you.
Up to £50k grant available through new innovation funding call – deadline 17 April
Innovate UK have launched a fast-track competition for businesses to develop innovative ideas that address COVID-19 related challenges and needs of society or economy. This could include, for example, new solutions for musicians to stream live performances and connect with their fan base, technology that allows retailers to better respond to spikes in customer demand or new remote teaching tools for schools. Grants of up to £50k will be available and businesses can recover 100% of their project costs. The projects must start by June 2020 and can last up to 6 months. Resulting products and services are expected to be available to the public towards the end of 2020. Apply until midday on 17 April 2020. Further details are available here: https://www.apply-for-innovation-funding.service.gov.uk/covid19/overview.html
Clarifications on furlough and job retention scheme
The guidance on the Coronarvirus Job Retention Scheme has been updated over the weekend. It now clarifies that all employees who were on an employer’s PAYE scheme on or before 28February 2020, which also includes agency workers and apprentices. Directors can only be furloughed if the company board formally decides so and notes this in the company records. Furloughed directors are not allowed to do any work, apart from carrying statutory duties. Staff on fixed term contracts an only benefit from the scheme until their contracts end. Employers must confirm in writing to their concerned employees that they have been placed on furlough and for how long. The furlough period must be at least three weeks long and employees can be furloughed multiple times, but each separate instance must be for a period of 3 consecutive weeks. Further details are available here: https://www.gov.uk/guidance/claim-for-wage-costs-through-the-coronavirus-job-retention-scheme
Easier access to loans for small firms
After many businesses complained that they cannot access the Coronavirus Business Interruption Loan Scheme (CBLIS), the Chancellor announced on Friday that all viable small businesses affected by the pandemic can now get loans through the scheme, not just those unable to secure regular commercial financing. To remove another obstacle, banks are no longer allowed to request personal guarantees for loans under £250,000. For loans over £250,000, personal guarantees will be limited to 20% of any amount outstanding on the CBILS lending after any other recoveries from business assets. These changes apply to new loan applications and loans already offered. Guidance on how to access the scheme is available here: https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/for-businesses-and-advisors/
New loan scheme for larger companies
The CBLIS mentioned above is limited to companies with an annual turnover of up to £45m. In order to also support larger firms, a new Coronavirus Large Business Interruption Loan Scheme (CLBILS) will be set up, aimed at companies with an annual turnover between £45m and £500m. The scheme provides a government guarantee of 80% to enable banks to make loans of up to £25m, at commercial interest rates. More details of the scheme will be announced later in April, it is therefore likely to take some weeks before applications can be made.
UK Government improves insurance cover for exporters
If you are selling to international customers, you might be interested to hear that UK Export Finance, Britain’s export credit agency, have expanded the scope of their Export Insurance Policy to cover markets including the EU, US, Japan, Australia, New Zealand, Canada and others. The Export Insurance Policy covers against the risk of not being paid under an export contract or not being able to recover the costs of fulfilling a contract that gets cancelled for certain reasons. The policy is available to exporters that are unable to get cover through the commercial market. Further details and instructions on how to apply are available here: https://www.gov.uk/guidance/export-insurance-policy