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    Businesses given more time and greater flexibility to repay Bounce Back Loans

    The Chancellor has announced that Bounce Back Loan borrowers will now have the option to tailor repayments according to their individual circumstances. Over 1.4 million businesses who collectively took out nearly £45bn through the Bounce Back Loan Scheme now have the option of using a new and more flexible ‘Pay as You Grow’ scheme.

    Pay as You Grow (PAYG) provides businesses who received funding via the Bounce Back Loan scheme with the opportunity to delay all repayments for a further six months, meaning borrowers can choose to make no payments on their loans until 18 months after they originally took them out.

    PAYG will provide borrowers with further flexibility such as:

    – The ability to extend the length of their loans from six to ten years, which reduces monthly repayments by almost half.

    – Being able to make interest-only payments for six months (an option that can be used up to three times) to tailor their repayment schedule to suit their individual circumstances.

    These new options are provided in addition to the original details of the scheme, in which the Government confirmed it would cover the cost of interest for the first year of the loan.

    The Government has announced that lenders will reach out to borrowers to provide information on repayment schedules and how to access flexible repayment options. Lenders will directly inform their customers of PAYG opportunities, and borrowers should only expect to hear from them three months before their first repayment is due.

    The Government has made clear that lenders are expected to offer PAYG options to all borrowers under the Bounce Back Loan scheme.

    If you need help with your funding requirements or would like to discuss the announcements surrounding Pay as You Grow, please contact your usual PM+M representative or get in touch with a member of our funding team at



    This information is correct as of 17 February 2021. This blog is for general guidance only. Recipients should not act upon any of the information provided without seeking specific professional advice tailored to your circumstances, requirements or needs. Please contact PM+M before making any decisions based on any matters relating to this blog.

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