145,000 Bounce Back Loans worth £3.8bn in arrears

A Freedom of Information request to the British Business Bank by Purbeck Personal Guarantee Insurance, the UK’s only provider of personal guarantee insurance (PGI) to small business owners has revealed the current level of debt and arrears associated with the Bounce Back Loan Scheme (BBLS), The Coronavirus Business Interruption Loan Scheme (CBILS) and the Recovery Loan Scheme (RLS). Purbeck’s analysis shows that over 145,000 BBL loans worth £3.8bn are in default as businesses continue to battle economic headwinds.

The findings come as latest estimates show that of £47bn paid out in Bounceback Loans, £17bn is already expected to be lost, £4.9bn of that – over 10% of the loans – to fraud.

9% of Bounce Back Loans are currently in default, down fractionally from 12% in July 2022 with the average loan in default standing at £26,571.

While there are fewer CBILS loans in default – under 2% – this is a small rise on July last year when 1% of loans were in default. The average amount owed is £175k, from £164k in July 2022.

The analysis has also uncovered that businesses are typically borrowing £210k under the Recovery Loan Scheme which is open for applications until June 2024, and the average personal guarantee commitment made by business owners to secure a loan under the Scheme is £472k.