Chancellor Rishi Sunak has announced updated terms for the government's bounce back loan scheme.
Over £45 billion of loans were provided via the government supported loan scheme, which launched back in May last year.
Now the 1.4 million businesses who have the loans are being offered generous new terms to help ease the burden of making payments.
The total sum can now be repaid over 10 years rather than the initial six year term (the first 12 months are free of repayments and the government pays the interest).
Businesses are also allowed to choose to only pay the interest on the loan (at 2.5 percent).
In addition to the previously announced payment holiday option, businesses can now opt to take a six-month payment holiday immediately before any monthly payments have been taken.
The latest announcement effectively gives businesses an extra six-months before repayments start leaving their cashflow. We have updated our bounce back loan calculator to illustrate the effects. You can play with the loan terms, add the initial payment holiday and also add overpayments. A full schedule of the loan is produced to give an easy breakdown.
Businesses will be sent letters before their 12 month interest free period comes to an end with information on how to use the new flexible options.