Transition Fund
The bridging mezzanine loan is available to businesses with a minimum turnover of £1 million, in order to bridge the gap between the amount of finance businesses are able to raise from the commercial sector and the amount they need to survive and grow during this period of economic instability.
Key Aspects of the Loan:
- Unsecured loan, however, security may be required by way of a mortgage debenture
- Initial term of up to 12 months
- No capital repayments or interest payments until maturity
- 1% interest per month, payable at maturity
- Additional 10% ‘mezzanine’ charge of loan advance payable at maturity - some circumstance may allow a reduced charge e.g. where security is provided
- No arrangement fees
Businesses applying for a Transition Fund loan should be SMEs* that can demonstrate sound, steady development of the core business in its sector over past 3 years. Companies will be facing cash flow difficulties brought about by unexpected changes in funding lines or trade credit and should also be operating in a market which is not fundamentally oversupplied.
Turnover must be at least £1 million and up to circa £35 million (as per SME definition).
Companies operating in most business sectors are eligible for the Transition Fund but there are some exclusions. These exclusions include, but are not limited to:
- land & property development
- accountants & legal services
- hotels
- nursing & residential care homes
- international motor transport
- agriculture
- forestry & timber production
- horticulture
How To Apply:
In order to apply you should be able to provide an existing business plan with updated financials, forecasts and bank statements.
For an initial discussion please call the Finance South East office on 01276 608510. If your business is considered to be potentially suitable for funding you will be asked to complete a simple application form.
If you are already working with one of our SEEDA Partners, e.g. the Enterprise Hub Network, please contact your advisor who will be able to discuss your needs.
*SME according to EC definition: <250 employees, < 50mn euros turnover OR < 43mn euros balance sheet net worth at official exchange rate
