Newly incorporated company - BBL

khanji17

I would like to know if anyone with a newly incorporated limited company (feb 2020) managed to get BBL with a projected turnover? I have just opened a business bank account in May with HSBC and applied for BBL, but would like to know if there are any success stories out there?

[Deleted User]

I doubt you would be eligible, as you didn't even open a bank account until May, two months after the Covid-19 economic downturn started, then it would appear that you did not start trading until after this all began. The requirement is to have been "established" before 01/03, they may take incorporation as meeting that but I would be doubtful as without even having opened a bank account that would indicate you were not trading. 
The projected turnover was because any companies had not completed a full year's trading to produce accounts, but I think banks would look at not having even started negatively, they have a lot more flexibility in relation to start ups, my opinion would be you will get a flat no, although you will not know for sure unless you apply.

Jeremy535897

The condition regarding 1 March 2020 is as follows:
"The business is engaged in trading or commercial activity in the UK at the date of the application, was carrying on business on 1 March 2020 and has been adversely affected by coronavirus (COVID-19)."

See https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/faqs-for-small-businesses/

khanji17

The business started trading in Feb 2020 and has been impacted, I was using my current account for the transactions while figuring out which bank to go with and then the pandemic happened. The BBL can really help the business surprised, but I won't be keeping my hopes high.

Jeremy535897 said:

The condition regarding 1 March 2020 is as follows:
"The business is engaged in trading or commercial activity in the UK at the date of the application, was carrying on business on 1 March 2020 and has been adversely affected by coronavirus (COVID-19)."

See https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-schemes/bounce-back-loans/faqs-for-small-businesses/

jfinnie

Disregarding that it's really bad practice to use a personal bank account for a Ltd co (that might be a an understatement) - can you actually evidence that this business has traded before the date in question?

[Deleted User]

Adding to what jfinnie said about the bad practice of operating a limited company using a personal bank account, you would need to demonstrate trading. Whilst theoretically possible if you have invoiced clients, had public liability insurance in place etc. then that might be acceptable, however I suspect the lack of a business bank account before all this will completely scuttle any claim. The bank is unlikely to have a process in place to deal with something as odd and inadvisable as operating a limited company via a personal account.

khanji17

Agreed, but I do have the trading invoices and liability insurance. I was also in talks with my business manager in February. Will see how it goe.jfinnie said:

Disregarding that it's really bad practice to use a personal bank account for a Ltd co (that might be a an understatement) - can you actually evidence that this business has traded before the date in question?

Grumpy_chap

It seems reasonable that the bank would seek some evidence of realism in the predicted turnover figure you used.

You say that you began trading in February - this gives you 1 or 2 months of record (before coronavirus) that can be multiplied up to a full year as one prediction of turnover.  I recognise that first month trading is not necessarily representative.

I assume you also have a business plan that you can evidence was in place before you began trading in February.  This gives you another reference to use as the basis of predicted turnover.

The fact you incorporated the business does give some certainty to date of establishment.

What is it that your business sector is in?  

How much BBL were you applying for?  You will be surprised at the number of threads on here where people say "I started a new self-employed business on 28th Feb and applied for the £50k BBL as 25% of my forecast £200 turnover.  Obviously I have no evidence of the predicted turnover"