‘Pay as You Grow’ Bounce Back Loan repayment: Choosing the right plan for you

Ruth Bethel
Access to Finance Specialist
11th February 2021

If you’ve taken out a Bounce Back Loan (BBL), you can now tailor your repayment plan according to your circumstances. 

The Treasury’s ‘Pay as you Grow’ scheme now offers 1.4 million businesses much greater flexibility and more time to recover. 

That really is good news – under the initial terms, repayments, including interest, would have begun from May for thousands of businesses, when the economy is still expected to be heavily constrained by the pandemic. 

But what are the repayment options, and how do you choose one that’s right for you? Here's what you need to know: 

Pay as you Grow repayment options  


Six-month extension 

Delay all repayments for a further six months, extending the repayment-free period from 12 to 18 months. 

If you took out a BBL early on and are still suffering business loss through lockdown, this will likely be the option for you. 

Pause repayments 

You can now pause repayments after your first repayment, rather than after your sixth.

This option could be one to keep on the back burner. Start your repayments if you’re able, see how you manage – but keep this option in mind in case turnover does not pick up as quickly as you had hoped. 

Interest only payments for six months 

You can use this option up to three times during the term of your Bounce Back Loan. 

This is useful if you think you will need some months to build your turnover and profits back to pre-pandemic levels. As we emerge from lockdown, you will likely need to spend – on wages, stock, equipment etc – before you can earn, and interest-only repayments could give you scope to make those investments. 

Extend the length of your loan term from six to 10 years

This option will reduce repayments by almost half, lowering your outgoings considerably. Remember that you will pay more interest in the long run.


You can take advantage of these repayment options individually or in combination with each other. 

From this week, lenders will begin reaching out to borrowers to provide information on repayment schedules and how to access flexible repayment options.

If you’d like to talk through the options and discuss which one is right for you, leave your details with us and a member of our finance team will give you a call back. It’s a fully funded service for eligible businesses. 

You can also use our Finance Hub to explore other funding routes, weigh up the pros and cons, and access approved providers. 


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