Is your business eligible for Pay as you Grow?
You can apply for Pay as you Grow in Online Banking or the Barclays app if
- You currently have a Bounce Back Loan
- You’re at least nine months into your initial payment holiday – this will take effect when your payment holiday ends
- You’re listed on the mandate and have full access to Online Banking or the Barclays app. You also need to be authorised to make changes on behalf of the business account
You can apply for any of the Pay as you Grow options, or all of them, once they’re available for your loan. There are no additional fees and this doesn’t impact your ability to pay off the loan early.
Using these options won’t affect your credit score or negatively affect your creditworthiness, provided you keep up with your repayments. We may use previous requests, including those for Pay as you Grow options, to help us assess affordability in future lending applications. Our ‘Build your business credit score’ page has more information, including how to keep your business credit score healthy.
If you want Pay as you Grow to start from your next loan repayment, you need to apply at least 20 days before that repayment is due.
The wording below is from the British Business Bank, and covers the repayment of your Bounce Back Loan. We’ll send you regular reminders to let you know when your repayments will start and how much you’ll pay. There’s no need to contact us at this time, we'll contact you with information on your repayments and your options ahead of your first repayment.
Repaying your Bounce Back Loan
You received a payment holiday for the first year of your loan, with the interest being paid by the government via a Business Interruption Payment. After the first 12 months, you’ll need to start making monthly repayments to repay the amount you borrowed, plus interest from the date your repayment holiday ends.
We’ll send you a repayment schedule outlining your options, around three months before your first payment is due. Please note, you don’t need to contact us in advance.
If you no longer need the loan, you can choose to pay it back early. You’ll then pay less interest. There are no early repayment charges and you won’t pay any interest if you pay the full amount before the end of your initial 12-month repayment holiday.
Or you can make a one-off repayment, as well as additional payments on a regular basis, and doing so will also help save you money on your interest payments.
Your other repayment options
Pay as you Grow
The government has announced Pay as you Grow options for Bounce Back Loan borrowers to help businesses get back to regular trading. Pay as you Grow could give you more time and flexibility to pay back your loan.
You can apply for Pay as you Grow when you’re nine months in to your initial payment holiday (this will then take effect when your payment holiday ends).
What are the Pay as you Grow options?
Option 1a: You could reduce your monthly repayments for six months by paying only the interest.
- The total amount you owe will go up. This is because your interest costs increase as you’re repaying your loan over a longer period
- This option is available up to three times during the term of your Bounce Back Loan
- You can also extend the term of your loan by six months at the same time (to a maximum of 10 years) to keep your repayments similar to what they are now
Option 1b: You could take a payment holiday for six months.
- The total amount you owe will go up. This is because your interest costs increase as you’re repaying your loan over a longer period
- This can be used once during the term of your Bounce Back Loan
- This means you make no payments for six months (capital or interest). You’ll still be charged interest during the six-month repayment holiday and this’ll be added to the amount of your loan. As a result, your remaining loan repayments will go up
- You can also extend the term of your loan by six months at the same time (to a maximum of 10 years) to keep your repayments similar to what they are now
Option 2: You could request an extension of your loan term from six years to 10 years at the same interest rate of 2.5%.
- Extending to 10 years would reduce your monthly payments
- You’ll accrue more interest, so the total amount repayable would increase, unless you repay early
If you’re considering this option, you should think carefully about your ability to repay over a longer timeframe, taking into account such things as if you intend to cease trading or retire within the revised term of your Bounce Back Loan.
You can use option 1 and 2 together if you need to. Both option 1a and 1b will be available throughout the course of your loan term.
Our Bounce Back Loan repayment calculator can help show you the impact of the Pay as you Grow on your monthly repayments and the overall amount you’ll have to repay. This information can be tailored to your individual circumstances.
We’re here to help
You don’t need to contact us in advance. We will send you a repayment schedule outlining your options, around three months before your first payment is due.
If you’re worried about your finances, please visit our money management hub where you can find articles on cashflow including tools and calculators to help you plan and manage your finances.
You can also contact the following organisations for free advice
Business Debtline – chat online or call 0800 197 6026
National Debtline – if you live in England, Scotland or Wales call 0808 808 4000
Citizens Advice – online or visit your local Citizens Advice centre
Other business finance support options
In addition, the British Business Bank are aware businesses may be worried about their finances or how to manage repayments of their Bounce Back Loan. They have a range of guidance and resources available to all businesses, including content on managing your cashflow and a list of independent advice services.