Government urged to up 80% guarantee on smallest emergency business loans as average value tops £170,000
Added by Love Business East Midlands | 24 April 2020
UPDATED: 27 April 2020
New UK Finance figures show that 16,624 of the 36,186 small business finance applications for a Coronavirus Business Interruption Loan Scheme (CBILS) facility have been processed and approved. The average value of a CBILS loan stands at £171,000.
Responding to the statistics, Federation of Small Businesses (FSB) National Chairman Mike Cherry said:
“These figures mark an improvement. But we need to see far more from the banks where the speed of processing applications and making money available to the smallest businesses are concerned.
“The average value of a CBILS loan stands at more than £170,000. The case studies presented by UK Finance today all concern firms that have managed to secure big facilities. The small shops, restaurants, gyms, manufacturers and mechanics at the heart of our communities are not seeking loans of anywhere near this size.
“The Government should up its guarantee on emergency loans with values under £30,000 from 80% to 100%. That, combined with the streamlined application process that should be in place for facilities of this size, should help to get more cash to the small firms that really need it. We appreciate that many banks need to make backroom adjustments to facilitate commercial loans worth under £25,000 due to the Consumer Credit Act. It’s important that these adjustments are made swiftly.
“We now need to know how many micro businesses have been helped by the scheme to date. Firms deserve to know what the application process looks like at every stage at every approved lender. Banks should also be publishing decline rates.
“We continue to hear from small firms that made enquiries when this scheme launched but have still been unable to make an application because of unresponsive customer service teams. For those that have made an application, the process is very slow.
“Equally, we’ve heard from exporters that have been declined facilities on the basis that the majority of their revenue comes from international sales. It seems this was the result of overzealous interpretations of guidelines, and we appreciate the British Business Bank’s efforts to provide clarity in this area.”
Author of this COVID-19 Business Support Hub Article
Nicola Moss, Operational Support Coordinator – East Midlands (FSB)
Nicola Moss
Operational Support Coordinator – East Midlands Federation of Small Businesses.
Nicola is a professional in events, social media marketing and communications supporting small businesses. Her expertise positions her well to help small business owners find support and opportunities through marketing and communications.
The FSB mission is to help smaller businesses achieve their ambitions. Established 45 years ago, FSB is the UK’s largest grassroots business campaigning group, which ensures the voice of small businesses is heard at the highest level across the UK, as well as providing business services and products to our members.
As experts in business, FSB offers members a wide range of vital business services, including advice, financial expertise, support and a powerful voice in Government.
How to get in touch with Nicola Moss
www.fsb.org.uk
COVID-19 Business Support Hub
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