How Bounce Back Loans are repaid
Bounce Back Loans were government-backed loans for small businesses during the coronavirus pandemic. They have a fixed interest rate of 2.5% a year and an original term of 6 years. No repayments were due in the first 12 months, so the loan is repaid over the remaining 5 years.
The scheme has closed to new applications, but existing borrowers are still repaying.
Worked example
A £30,000 Bounce Back Loan repaid over 60 months at 2.5% costs £532.42 a month, £31,945.25 in total, including £1,945.25 of interest.
Pay As You Grow options
Under Pay As You Grow, borrowers could ask their lender to extend the loan from 6 to 10 years at the same 2.5% rate, switch to interest-only payments for 6 months (up to three times), or take one repayment holiday of up to 6 months.
These options lower payments but mean paying more interest overall. Enter your new term in months to see the effect. You remain fully responsible for repaying the loan.
Inputs for the bounce back loan calculator
Amount to borrow
The amount of your Bounce Back Loan, or the balance you still owe.
Interest rate (per year)
Bounce Back Loans have a fixed rate of 2.5% a year.
Term
The number of months you're repaying over: 60 for the original term after the first year, or more if you've extended under Pay As You Grow.
CALCULATOR QUESTIONS
Bounce back loan calculator questions
What is the interest rate on a Bounce Back Loan?
A fixed 2.5% a year for the life of the loan.
How long is a Bounce Back Loan?
The original term is 6 years, with no repayments in the first 12 months. Under Pay As You Grow it can be extended to 10 years.
Can I still apply for a Bounce Back Loan?
No. The scheme has closed to new applications.
What if I can't keep up repayments?
Speak to your lender about the Pay As You Grow options. You remain responsible for the debt.