The move aims to ensure those large firms which do not qualify for the Bank of England’s COVID Corporate Financing Facility (CCFF) have enough finance to meet cashflow needs during the outbreak.

The expanded loans, which have been introduced following discussions with lenders and business groups, will be available from May 26.

John Glen, the economic secretary to the Treasury, said: “We’re determined to support businesses of all sizes throughout this crisis and our loans and guarantees have already provided over £32 billion to thousands of firms. Today we’re increasing the maximum loan to £200m to make sure companies get the help they need.”

Businesses have benefitted from over £32bn in loans and guarantees to support their cashflow during the crisis. This includes 268,000 Bounce Back Loans worth £8.3bn, 36,000 loans worth over £6bn through the Coronavirus Business Interruption Loan Scheme, and £359m through the Coronavirus Large Business Interruption Loan Scheme, alongside £18.7bn through the CCFF.

Companies borrowing more than £50m through CLBILS will be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan, including a ban on dividend payments and cash bonuses, except where they were previously agreed.

These restrictions will also apply to CCFF participants that wish to borrow money beyond 12 months from today. This will ensure that the money is used to keep the company going through the crisis. The Bank will also publish a list of companies who have benefitted under CCFF on June 4.

Dr Liz Cameron, chief executive of the Scottish Chambers of Commerce, commented on the announcement. She said: “This is welcome news. The Treasury has continued to listen to the concerns of business and is making sensible changes to business support schemes.

“These vital changes will make a real difference to companies, in particular larger firms. Access to finance is a priority for businesses of all sizes and the changes to this scheme, coupled with the other lending support schemes available will make sure that companies get the help they need to see them through this economic crisis.”

Suren Thiru, head of economics at the British Chambers of Commerce (BCC), added: “It is good to see the government continue to listen to business concerns and make improvements to existing schemes.

“These important changes could make a real difference to larger firms in particular and alongside the other lending support schemes will help ensure that more businesses of all sizes get access to the finance they need to help weather this unprecedented economic storm.”

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