I was delighted to be able to work with the Chancellor to remove some of the obstacles that prevent businesses from accessing Coronavirus Business Interruption Loans quickly. The Chancellor announced new measures to make it easier for firms to access loans by removing the need for a forward-looking viability test or future business plan on a loan application following discussions I had had with him. As a businessman I have repeatedly made the case that the loan scheme to help businesses has been too complex and too slow for those that need immediate access to cash to survive. I was proud when the Chancellor referred to me as a ‘doughty champion’ of all those who want access to loans. The Chancellor said that the Treasury team had been working with banks over the past week to make changes to the Coronavirus Interruption Loan scheme (CIBILS) which will make it easier for firms to get their money within 24 hours.
The Chancellor also announced a new Bounce Back loan scheme, which starts next week, would mean micro businesses can access a maximum of £50,000 or 25% of turnover with the Government paying the interest for the first 12 months. I have made the point that the loans should not have complicated conditions attached which slow down the process of approval and the Chancellor was able to reassure me that “The banks would not require the provision of forward looking information or business plans which will be a comfort to business“ whilst the banks themselves will not take the risk as the loans are being underwritten by the Government.
I took the opportunity to thank the Chancellor for the excellent work he has done to support businesses. I am delighted that Mr Sunak has responded so swiftly to the concerns of businesses. I have spoken to a great number of business people over the past few weeks who have been both worried and frustrated by the length of time and complexity involved in accessing loans and this new scheme will save many from going under before they are able to access the cash. This follows on from other improvements the Chancellor made recently to the Coronavirus Business Loans Interruption Scheme after banks were required to remove the requirement for a personal guarantee on loans up to £250k and arrange CBILS loans as the default option rather than trying to arrange a standard commercial loan. As a result of these changes, business now have easy access to loans ranging from £2k to £5m for all those affected by the virus outbreak.
Businesses should approach their own bank in the first instance for access to these loans of one of the growing number of lenders authorised to distribute them. A full list of these can be found here https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption-loan-scheme-cbils-2/current-accredited-lenders-and-partners/