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COVID-19 advice and updates for SMEs and the self-employed

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COVID-19 personal finances advice and updates

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Good morning. Earlier this week, we reported that businesses faced problems accessing the Coronavirus Business Interruption Loan Scheme (CBILS). The chancellor has now banned lenders from requesting personal guarantees for emergency business loans under £250,000.

The problems with CBILS have been laid bare by the application statistics. New Treasury figures show that only 983 firms have had loans approved – contrasted with 130,000 enquiries.

To speed up the number of loans being granted, chancellor Rishi Sunak has made another important change to the CBILS scheme. Beforehand, CBILS loans could only be offered to a business if it was unable to access finance on normal commercial terms. Consequently, this led banks and other lenders to offer their own (often more expensive) loan products to businesses in difficulties. From now on, “all viable businesses affected by COVID-19” will be eligible for CBILS.

The loans of up to £5m are for businesses with a turnover of under £45m. This has caused problems for mid-sized firms who felt that the Covid Corporate Financing Facility (CCFF) was aimed at much larger companies.

New Coronavirus Large Business Interruption Loan Scheme

Importantly, the chancellor has announced a new Coronavirus Large Business Interruption Loan Scheme (CLBILS) to meet the needs of larger firms. It will offer an 80% government guarantee, allowing banks make loans of up to £25m to companies with a turnover of between £45 million and £500 million. Please note that these loans will be offered at commercial rates of interest. Further details of the scheme will be released later this month and we will update you as we know more.

Banks encouraged to speed up lending

Hopefully, the changes to the emergency business loan schemes will speed up lending to firms in need. For this, the ball is now squarely in the banks’ court. However, with stretched workforces – often reduced by employees with COVID-19 or self-isolating – lenders will have their work cut out. Not only are they dealing with a surge of enquiries about emergency business loans, but they are handling an avalanche of requests for mortgage holidays and extensions to credit card limits.

For more information on the Coronavirus Business Interruption Loan Scheme, visit the guidance on the British Business Bank website. Helpfully, it also carries a list of accredited CBILS lenders.

Finally, if you would like to talk to one of our team about navigating your business through the current pandemic, please get in touch. We’re here and ready to help you.




Avatar for Jon Pryse-Jones
About Jon Pryse-Jones

Since joining THP in 1978, Jon Pryse-Jones has been hands on with every area of the business. Now specialising in strategy, business planning, and marketing, Jon remains at the forefront of the growth and development at THP.

An ideas man, Jon enjoys getting the most out of all situations, “I act as a catalyst for creative people and encourage them to think outside the box,” he says, “and I’m not afraid of being confrontational. It often leads to a better result for THP and its clients.”

Jon’s appreciation for THP extends to his fellow team members and the board.  “They really know how to run a successful business,” he says.  He’s keen on IT and systems development as critical to success, and he continues to guide THP to be at the cutting edge and effective.

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