PPP’s UK Cousin, The Bounce Back Loan Scheme Fraud Exceeded 10% of Disbursements

April 10, 2026

Bob Coleman
Founder & Publisher

PPP’s UK Cousin, The Bounce Back Loan Scheme Fraud Exceeded 10% of Disbursements

Like PPP, the U.K.’s Bounce Back Loan Scheme was launched to provide rapid financial support to small businesses.

Under BBLS, small businesses could borrow between £2,000 and £50,000, capped at 25% of revenues, with the UK government providing a 100% guarantee to lenders.

The loans carried a fixed interest rate of 2.5%, no interest or repayments for the first 12 months, and a term of up to 10 years (later extended under “Pay As You Grow” options). The program emphasized speed and accessibility—applications were short, self-certified, and funds were often disbursed within days. In total, the scheme issued approximately £47 billion across about 1.5 million loans.

For comparison with UK Bounce Back Loans: the PPP fraud percentage is lower than that of BBLS, largely because PPP had at least some underwriting, bank involvement, and post-funding forgiveness review, whereas BBLS was almost entirely self-certified at origination.

The UK Department for Business and the National Audit Office indicated potential fraud and credit losses could reach £5 billion to £6 billion, with some external analysts suggesting even higher ranges approaching 20% of total lending.

Common fraud patterns included inflated turnover claims, multiple applications across lenders, use of dormant or non-trading companies, and misuse of funds for personal purposes.
Meet Matloob Hussain. He admitted to three counts of loan fraud, totaling £150,000, involving Covid Bounce Back loans.

He was jailed on March 25th for two years and four months at Manchester Crown Court.
Hussain was running a clothing wholesaler and online retailer despite having been disqualified from acting as a company director for 10 years, effective from 2021.

In a UK small business, a director is a legally appointed individual responsible for managing the company and ensuring it complies with laws and regulations, acting on behalf of a separate legal entity.
In many UK small businesses, the director is also the sole shareholder and operator, but the legal responsibilities still apply.

The Insolvency Service said Hussain applied for three loans across three companies in 2020. The government agency said Hussain was the director of Dynasty Group Ltd, an Eccles-based wholesaler of clothes and footwear, and NA Collection Mcr Ltd, based in Manchester, which provided online sales of products such as confectionery.

Each business was entitled to one loan, but Hussain claimed a second £50,000 loan for both businesses and overstated NA Collection’s turnover.

Insolvency Service chief investigator Darren Bailey says: “Matloob Hussain clearly thought he was above the law and blatantly disregarded the rules of a loan scheme designed to help struggling businesses.

“By applying for multiple loans and continuing to act while disqualified, he caused significant loss to the public purse and undermined the insolvency system.”

The Insolvency Service said it would also look to recover the loans via the Proceeds of Crime Act, in addition to about £27,000 already returned.