Council launches business loan scheme

A loan scheme to assist local businesses experiencing cashflow difficulties as a result of the Covid-19 crisis has been launched today by Orkney Islands Council.

The Coronavirus Pandemic Emergency Loan Scheme will offer secured loans of between £50,000 and £100,000.

The loan scheme is the second measure to be put in place since elected members decided to create an initial £5 million fund in response to the economic impact Covid-19 is having. A Coronavirus Business Hardship Support Grant Scheme was launched earlier this month.

The grant and loans schemes were created following engagement with local business representatives.

During discussions with a broad range of business sectors, requests were made for the council to establish ways to ease the immediate pressure created by poor cash flow, with the curtailing of all trade in some sectors and severely limited trade in others.

The council fund is intended to supplement rather than replace national support measures – and business applicants should first explore whether they are eligible for assistance from the schemes put in place by the Scottish and UK Governments.

Before seeking a loan from OIC, businesses will need to have first applied for funding from the national Coronavirus Business Interruption Loan Scheme or the Coronavirus Bounce Back Loan Schemes.

Councillor Graham Sinclair, chairman of the council’s Development and Infrastructure Committee, said: “We are very aware of the hardship many businesses are facing in these uncertain and challenging times.

“I am pleased that the emergency loan scheme, as well as the hardship grant scheme, are now in place and open for applications.

“Many local businesses are receiving assistance from the government support schemes – and these should be the first port of call for those affected by the economic effects of the crisis

“But we know from our engagement with Orkney’s business sectors that the national schemes won’t help all businesses.

“The new loan scheme offers a further option for those that have been unable to secure support elsewhere.

“If your business is facing this situation I would encourage you to check online to see if it is eligible – and to get in touch with our economic development team or Business Gateway Orkney if you are unsure or feel it doesn’t quite meet the criteria.”

Standard loan terms are for a duration of up to six years, with an initial repayment holiday period of up to a year, followed by up to five years to repay the loan balance in full. Exceptionally, requests for a loan period of up to 10 years may be considered.

Businesses can find guidance and check the criteria for funding here www.orkney.gov.uk/CV-Loan-Guide and, if eligible, apply online here www.orkney.gov.uk/CV-Loan

Those that are unsure about their eligibility should contact the Council’s economic development team for advice at economic.development@orkney.gov.uk