Recovery Loan Scheme (iterations 1 & 2) Performance Data as at 31 March 2023

24 May 2023

The British Business Bank launched the Recovery Loan Scheme (RLS) in April 2021, to support access to finance and growth for UK businesses as they steered a path towards a sustainable recovery following the Covid pandemic. This first iteration of the scheme was originally scheduled to run until 31 December 2021.

In the 2021 Autumn Budget the scheme was extended by six months to 30 June 2022, resulting in the second iteration of the RLS. At that time some adjustments to the Scheme’s terms were made: the government had provided a guarantee to accredited lenders of 80% for scheme facilities offered before 1 January 2022, reduced to 70% for scheme facilities offered on or after that date. The borrower remains 100% liable for the debt.

RLS iterations 1 & 2 were closed to new applications on 30ᵗʰ June 2022.

As part of British Business Bank’s ongoing commitment to promote sustainable accessible funding for UK smaller businesses, to enable them to invest and grow, a new (third) iteration was announced by the government and opened for applications on 1 August 2022. View further details on the Recovery Loan Scheme is available on the British Business Bank website.

*Data for the current third iteration of RLS is not included in this publication.

Performance

Since the launch of RLS, the British Business Bank has published performance data (for iterations 1 & 2) on 20 July 2022 and 21 February 2023 with a commitment to publish performance data on a quarterly basis thereafter.

This publication provides data as at 31 March 2023 for the RLS (iterations 1 & 2). As with previous publications, the data relies on information submitted to the British Business Bank’s guarantee portal by accredited lenders.

RLS (iterations 1 & 2) Data

As at 31 March 2023, businesses had drawn 20,084 facilities, totalling £4.34 billion, through the RLS.

87.10% of RLS facilities (by number of drawn facilities) are on schedule, and 3.59% of scheme facilities are fully repaid. 1.98% are currently in arrears (but not yet progressed to default), and 2.14% are currently in default (but have not yet progressed to a claim by lenders). The government guarantee has so far been settled (that is, claimed by lenders and paid out by the British Business Bank) on 3.05% of the total RLS facilities.

All businesses remain responsible for repaying facilities under RLS and are fully liable for the debt.

It remains important to recognise that it is still early in the life of the RLS. Data being collected from scheme lenders is subject to refinement, addition, and correction over time, and should not be regarded as definitive nor conclusive as to the performance of the scheme. Please see limitations and further considerations (below) for further background.

Suspected Fraud

Lenders have currently identified 92 RLS facilities, which equates to 0.46% of the total volume, and with an aggregate drawn value of £26.20m as ‘suspected fraud’. Lenders continue to review cases, consequently this figure is subject to change. This relies on lenders’ business as usual threshold for fraud reporting. That is, the lender has derived sufficient grounds to suspect fraud, which is then reported via the British Business Bank portal.

Lenders are not law enforcement agencies or investigatory organisations. Where they have a suspicion that fraud has been committed by a borrower, they will indicate so in the information which they provide to the British Business Bank. Ultimately it is law enforcement/ the courts which determine whether or not a fraud has been committed, and so the statistics presented are only an indicator of the levels of suspected fraud which have been identified within the scheme at a given point in time.

Detailed Facility Status

The first table shows current figures rather than original drawn facilities figures.

See definitions below when interpreting these tables.

Table 1: RLS-Summary Facility Status

Furthest life event reached	Number of facilities	% Number of facilities	Outstanding balance (£m)	Final value (£m)
On Schedule	17,493	87.10%	3,016.57	-
Arrears	398	1.98%	51.98	-
Defaulted	429	2.14%	74.95	-
Claimed	431	2.15%	42.91	-
Settled	612	3.05%	-	52.47
Fully Repaid	721	3.59%	-	243.33
Grand Total	20,084	100%	3,186.41	295.80

Note on Table 1

The values in Table 1 will not sum up to the total Drawn Value as it is not possible to take account of events which can reduce outstanding balances - for example: partial repayments of a facility, certain recoveries received in respect of a facility and facility amounts written-off by lenders.

The following tables show original drawn aggregate facility value and number of facilities for each lender, by region and by SIC group, together with current aggregate value and number of settled facilities for each lender.

Table 2: RLS-Breakdown of facilities drawn and settled

Lender name	Drawn value (£m)	Number of facilities	Settled value (£m)**	Settled number of facilities
ABN AMRO Asset Based Finance N.V.	5.61	8	-	-
AIB Group (UK) Plc	3.55	4	-	-
Aldermore Bank Plc	62.52	241	0.56	4
Allica Bank Limited	2.11	2	-	-
Arbuthnot Latham & Co Ltd	192.84	84	-	-
Arkle Finance Ltd	9.52	101	0.02	2
ART SHARE Limited	2.51	42	0.03	1
Assetz Capital Lending Limited	42.42	14	-	-
Atom Bank plc	132.51	180	-	-
Bank Leumi (UK) plc	32.34	16	-	-
Bank of Scotland plc	6.48	42	-	-
Barclays Bank Plc	52.66	183	-	-
BCRS Business Loans Ltd	3.94	64	-	-
Big Issue Invest Ltd	0.30	2	-	-
Business Enterprise Fund	9.26	131	-	-
Business Lending Group	24.30	12	-	-
Capitalise Business Support Ltd	1.88	24	-	-
Close Brothers Ltd	203.42	595	0.19	4
Clydesdale Bank Plc	48.97	70	1.40	1
Compass Business Finance	4.60	64	0.32	3
Conister Finance & Leasing Ltd	32.33	204	-	-
Coventry & Warwickshire Reinvestment Trust Ltd	1.81	23	-	-
Cynergy Bank Ltd	59.94	29	-	-
Danske Bank	2.90	5	-	-
DSL Business Finance	0.64	10	0.06	1
Ebury Partners UK Ltd	0.45	2	-	-
Edinburgh Alternative Finance Limited T/A Lending Crowd	14.97	96	0.17	1
Enterprise Answers	0.28	3	0.07	1
Enterprise Loans East Midlands	2.78	38	0.21	4
EVBL (General Partner NPIF Y&H Debt) Limited	11.66	51	-	-
Fiduciam Nominees Limited	4.87	1	-	-
Finance for Enterprise	7.07	76	0.03	1
FSE GLIF LD LP	14.19	18	-	-
FSE GLIF SD LP	6.34	24	-	-
FSE MEIF LP	10.15	28	-	-
Funding Circle	899.85	9,107	30.52	422
GC Business Finance	0.97	14	-	-
Genesis Asset Finance Ltd	0.90	16	0.01	2
Growth Finance Fund LP (WhiteRock Capital Partners LLP)	3.50	5	-	-
Growth Lending Group Ltd	168.20	44	-	-
Hampshire Trust Bank Plc	67.94	57	1.75	5
Haydock Finance	17.49	78	0.53	5
HSBC UK Bank Plc	559.86	2,317	2.24	30
Independent Growth Finance Ltd	9.54	19	0.14	1
InterBay Asset Finance Limited	5.55	30	-	-
Investec Bank PLC	68.84	237	1.54	2
Iwoca Limited	30.96	119	0.32	2
Kingsway Finance group	22.25	195	0.39	6
Kriya Finance (Formerly MarketFinance)	104.21	622	1.02	12
Lendnet LLP	16.22	14	-	-
Lloyds Bank Plc	59.42	258	-	-
MEIF - ESEM SBL LP	2.98	38	0.20	3
MEIF - Maven East and South East Midlands	12.31	32	-	-
MEIF - Maven West Midlands	12.37	28	-	-
MEIF - WM SBL LP	2.12	39	-	-
Merchant Money Ltd	24.25	137	0.55	4
Metro Bank PLC	333.73	181	-	-
NatWest Group plc	111.12	951	1.71	24
NE Growth (ERDF) General Partner Ltd	3.54	18	0.43	3
Newable Business Loans Ltd	3.99	27	-	-
North East (ERDF) Small Loan Fund Limited	0.92	13	-	-
North West Loans NPIF GP Limited	13.41	45	0.17	1
Novuna	39.76	77	-	-
NPIF - NW MF LP	1.74	29	-	-
NPIF - YHTV MF LP	1.55	28	-	-
Nucleus Cashflow Finance Ltd	141.66	780	7.14	52
OakNorth Bank plc	9.62	6	-	-
Paragon Bank PLC	52.04	313	0.03	1
RM Funds	5.71	5	-	-
Robert Owen Community Bank Fund	0.05	2	-	-
Santander UK	56.05	22	-	-
Scania Finance Great Britain Limited	4.07	21	-	-
Secure Trust Bank plc	16.45	7	-	-
Shawbrook Bank Limited	10.15	11	-	-
Shire Leasing plc	12.88	193	0.38	9
Simply Asset Finance Operations	75.48	676	-	-
Skipton Business Finance Ltd	2.84	24	-	-
Social Investment Business Foundation	4.82	16	-	-
Starling Bank Ltd	22.82	186	-	-
SWIG Finance	6.70	69	-	-
ThinCats Ltd	140.24	73	-	-
Time Finance plc	4.58	64	-	-
Tower Leasing Ltd	8.63	202	0.14	4
Triodos Bank UK Ltd	10.60	9	-	-
TVC Loans NPIF GP Limited	5.74	21	0.20	1
UK Steel Enterprise Ltd	1.26	6	-	-
United Trust Bank Limited	135.45	116	-	-
Grand Total	4,339.37	20,084	52.47	612

**Settled – once the guarantee claim is processed and payment is released, the facility is marked as settled on the British Business Bank portal. Some lenders may be more advanced than others in their Claims and Recoveries processes which could lead to figures being distorted. Lenders may submit guarantee claims quarterly in line with the terms of the guarantee.

Table 3: RLS-Drawn by Region/Nation

Region	Drawn value (£m)	Number of facilities
East Midlands	305.85	1,497
East of England	410.45	2,034
London	1040.34	3,568
North East	109.67	623
North West	441.20	2,114
Northern Ireland	61.82	332
Scotland	225.46	1,122
South East	577.03	3,024
South West	295.03	1,636
Unspecified *	54.87	61
Wales	136.04	669
West Midlands	335.13	1,842
Yorkshire and The Humber	346.46	1,562
Grand Total	4,339.37	20,084

* This includes Channel Islands, Isle of Man and the facilities where lenders entered an invalid postcode

Table 4: RLS-Drawn by Sector

SIC Group	Drawn value (£m)	Number of facilities
Accommodation and food service activities	318.50	1,194
Activities of households as employers; undifferentiated goods-and services-producing activities of households for own use	0.11	2
Administrative and support service activities	365.69	1,894
Agriculture, forestry and fishing	23.39	223
Arts, entertainment and recreation	73.50	389
Construction	654.45	2,970
Education	35.24	283
Electricity, gas, steam and air conditioning supply	5.62	47
Financial and insurance activities	192.59	349
Human health and social work activities	210.16	782
Information and communication	228.65	1,166
Manufacturing	522.80	2,492
Mining and quarrying	5.41	28
Other service activities	68.04	603
Professional, scientific and technical activities	336.42	1,917
Public administration and defence; compulsory social security	3.09	19
Real estate activities	354.90	535
Transportation and storage	179.94	1,012
Unspecified*	3.19	2
Water supply; sewerage, waste management and remediation activities	50.78	227
Wholesale and retail trade; repair of motor vehicles and motorcycles	706.91	3,950
Grand Total	4,339.37	20,084

* This represents the facilities where lenders entered an invalid SIC code

Definitions

Definition of values –

- The value for ‘Claimed’ is the amount claimed under the guarantee
- The value for ‘Settled’ is the amount paid out under the guarantee
- The value for ‘Fully Repaid’ is the full facility amount
- The value for all other life events is the outstanding balance
Arrears– facilities with missed repayments are deemed to be in arrears and are tracked in 30, 60 and 90 day cohorts by lenders to manage risk. Lenders report monthly arrears updates through the Scheme portal on a “best endeavours” basis. Some lenders submit arrears via the automated (API) functionality in the Scheme portal, but it is not possible for smaller lenders to integrate with this functionality so arrears are entered manually. Facilities in arrears that have moved to a later life-cycle stage (such as Defaulted) will be reported in the later life-cycle stage but may still carry arrears. At the time of this event occurring, this is an actual balance, and not estimated.
Claimed– the Lender has submitted a claim under the guarantee. Facilities sit in the claimed status while the British Business Bank awaits/processes the invoice for the claim and runs relevant checks. Under the terms of the guarantee the claim must be paid within 30 days of receipt of the claims invoice.
Defaulted– facilities where the lender has issued a formal demand to the borrower. At the time of this event occurring, this is an actual balance, and not estimated.
Drawn value – the total amount for facilities which have been drawn down by the borrower.
Facility or facilities – refers to a Recovery Loan Scheme facility or facilities, being either a term loan facility, a revolving credit facility, an invoice finance facility or an asset finance facility (as applicable) made available by an accredited lender to a borrower.
Fully repaid– the facility is considered closed as there is no further outstanding balance on the facility (the borrower has repaid the full amount).
On schedule– the facility is being repaid as expected, including facilities for which repayment is not yet due.
Outstanding balance – when used to describe on schedule is a projected figure based on the amortisation profile of individual facilities. It uses existing data points to identify the remaining facility value but is limited due to some lender data not being available.
Scheme portal – the database hosted by the Bank as part of its role in administering the schemes. It is used by all accredited scheme lenders to report on guaranteed facilities and make claims under the guarantee agreement. The reporting requirements have evolved over time. The portal is updated at various points in a facility lifecycle as reported by lenders.
Settled– settlement has been made following a lender making a claim. Once the guarantee claim is processed and payment is released, the facility is marked as settled on the Scheme portal.
Suspected fraud – drawn facilities which are currently marked as suspected fraud by lenders. This flag can be added or removed by lenders at any point, and only the latest position can be provided. Suspected fraud value is a subset of the drawn value.

Limitations and further considerations

The following should be considered in relation to the data:

Data is as at 31 March 2023, and extracted on the 8 May 2023, from the information continuously submitted to the British Business Bank’s portal by accredited lenders. The portal is used by the British Business Bank and lenders to administer the facilities. Portal data is dependent on lenders submitting accurate and timely data and is not real-time.
The terms of and the timing of the scheme may not be representative of the lenders’ risk appetites, their general loan credit quality, or their default experience.
Given the size of the scheme, the numbers of facilities, and the period over which they were offered and drawn down, data being collected remains fluid and subject to refinement and correction over time (comparative analysis may therefore have limitations).
The timing and level of claims made on the guarantee will vary according to a lender’s business model and the characteristics of their customers (for example repayment options offered, age of businesses, whether new or existing customers).
Some lenders may be more advanced than others in operationalising their Claims and Recoveries processes which could lead to figures being distorted initially but this will stabilise over time.
Lenders may submit guarantee claims quarterly in line with the terms of the guarantee.
Claims on the guarantee may subsequently benefit from recovery receipts achieved at a later date (which are not reflected in the figures above), and so are not a conclusive indicator of net cost to government.
The number of guarantee claims and value is not necessarily related to the amount of fraud in a lender’s portfolio.
All data excludes loans where a scheme guarantee has been removed and the facility is no longer covered by the scheme.

This data is not suitable to be relied on by any party wishing to acquire rights against the British Business Bank group of companies (“BBB”) or any of the RLS guarantee scheme lenders for any purpose or in any context. Any party choosing to rely on the data detailed in this release (or any part of it) does so at its own risk. To the fullest extent permitted by law, the British Business Bank does not assume any responsibility or liability to any other party in respect of this data.

Notes:

On the 1^st August 2022 the British Business Bank released details of a 3^rd iteration of the Recovery Loan Scheme.

This new iteration of the Recovery Loan Scheme continues to be available through participating lenders, who are listed on the British Business Bank website. The bank has re-opened the scheme in February 2023 for other lenders to apply for accreditation.

Further information, for businesses and lenders, is available on the British Business Bank website.

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