My business has no cash reserves/money left to start trading again after coronavirus

Affected by Covid-19? Immediate Rescue Or Closure Options Available

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Updated: 8th March 2021

Businesses are rapidly running out of money amid the lockdown and social distancing measures brought in to tackle the coronavirus pandemic, which has led to widespread concern over how we will start trading again after the crisis has passed. 

Through no fault of their own, and despite extensive government intervention, businesses face the grim reality of having no cash reserves to fall back upon, and are therefore at particular risk of liquidation and closure when the economy reignites.

So if you’re in this situation, what are your options when you’re finally able to reopen your business but have no cash left with which to restart?


Government business grants

Small Business Grant Fund (SBGF)

If you run a business in England and receive Small Business Rates Relief (SBRR) or Rural Rates Relief (RRR), you may be eligible for a non-repayable government grant of £10,000 to support your business and help you restart trading.

Retail, Hospitality and Leisure Grant Fund (RHLG)

If you’re a retail, hospitality, or leisure business in England you could be eligible for a grant under this scheme, as follows:

  • £10,000 grant if your business property has a rateable value of up to and including £15,000
  • £25,000 grant if your business premises has a rateable value of more than £15,000 and less than £51,000

Grant funding has been provided to local authorities, and you’ll be contacted to arrange payment if you’re eligible.

COVID-19 government loan schemes

The government’s loan schemes for business, including the Coronavirus Business Interruption Loan Scheme (CBILS) and the Bounce Back Loan Scheme (BBLS), offer businesses access to government backed lending that could help you start trading again after coronavirus.

  • CBILS is backed by the government to the extent of 80% of each loan, and if you meet the eligibility criteria you may be able to secure funding of up to £5 million over a term of up to six years. Loan interest during the first 12 months is paid by the government, who also cover any lender fees and charges.
  • The Bounce Back Loan Scheme is designed to help smaller businesses with fewer than 10 employees, although the scheme is also open to larger organisations. The Bounce Back Loan Scheme offers loan amounts from £2,000 up to 25% of business turnover (maximum £50,000), and no payments need to be made for the first 12 months. The interest rate is 2.5% per annum fixed for the full term, and as with CBILS, the government pays the first 12 months’ interest.

With so many businesses experiencing financial distress, however, there have been delays in sanctioning loan applications, which may compromise your ability to secure vital finance to start trading again.

If your business is viable in the long-term, and you can’t afford to wait any longer or feel that the government loan schemes aren’t right for your business, you may be able to obtain a form of funding that doesn’t involve the banks.


Invoice finance

Factoring and invoice discounting may be appropriate if your business sells goods or services on credit, and you run a sales ledger of value. Funding is based on the value of the sales ledger, and financiers don’t need extensive proof of prior business performance – instead, minimal bad and doubtful debts are key to a successful application.

Invoice finance provides regular cash injections throughout each month, and as long as sales pick up again, removes the fear of having no cash reserves with which to operate normally and grow in the future.

Asset based lending

Some businesses are, by nature, asset rich but cash poor, in which case you may own assets that can be leveraged via a sale and lease back agreement – this would provide a lump sum of cash. Alternatively, you could sell any assets that aren’t currently essential to your business operations, offering you the chance to start trading again with more working capital.

Obtaining sector-specific professional advice under these circumstances can help you prevent business closure. Our team of licensed insolvency practitioners at Real Business Rescue are here to support you through this crisis, and can help you start trading again. Please contact the team to arrange a free same-day consultation in complete confidence.

Keith Tully


0800 644 6080
Director Support - Business suffering from Cash-Flow Problems?
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