Throughout the pandemic, the Government has offered £79.3bn in loans to help businesses survive and invest for the future.
However, only the Recovery Loan Scheme remains open until the end of June – with no replacement lined up to take its place.
Despite the popularity and value of these loan schemes, many small businesses are concerned they will struggle without access to the finances they need.
Government officials are now in talks with the banking sector to see if it is possible to make these small business loans a permanent fixture.
According to the Financial Times, the loans could mirror previous COVID financial support schemes. A close source to the talks told the newspaper that the focus of any future funding is on growth rather than business survival – which was the case for the previous loan schemes.
Among the questions asked are what level of support will the Treasury set, whether personal guarantees are needed and what sort of companies should be eligible.
We hope that additional details on any potential new loan scheme will be announced publicly in the next few months. Although, some abuse concerns remain after the Department of Business Energy and Industrial Strategy (BEIS) revealed that £4.9 billion could be unrecoverable from the £47.4 billion Bounce Back Loan scheme.
According to a senior industry executive in the FT article, British banks have lent more than £3 billion under this scheme. The Recovery Loan scheme, which guarantees 80% of a bank loan up to £10m, is in place until 30 June to support those in need.
Are you looking for business recovery guidance? If your organisation is seeking help after COVID-19 to rebuild and grow, speak with our advisors today.
Wilder Coe has supported many clients throughout the pandemic and implemented the necessary steps for recovery.
