Changes to the Coronavirus Business Interruption Loan Scheme will be announced as soon as this week.
Written on April 3, 2020 by Xeinadin Group
The chancellor is preparing to unveil an overhaul of his emergency aid scheme for small businesses (SMEs) amid warnings about a deluge of insolvencies as companies struggle to access funds from a banking system creaking under the COVID-19 crisis.
Sky News has learnt that Rishi Sunak will announce in the coming days that a key feature of the Coronavirus Business Interruption Loan Scheme - the requirement for banks to first assess whether SMEs are eligible for their other lending options - will be removed.
Mr Sunak and his officials at the Treasury are understood to have been in talks with the participating lenders, which include high street giants such as Barclays, HSBC, Lloyds Banking Group and Royal Bank of Scotland, on Wednesday.
An announcement is possible as soon as Friday, according to one insider.
The move will aim to speed up decision-making processes within the high street banks and channel loans more quickly, currently worth up to £5m, to an army of SMEs.
The Treasury has been sparked into action by myriad reports in the ten days since CBILS launched that business-owners are being denied loans through it or forced to use other standard SME loan products.
Under the revamped programme, any viable business with a turnover of up to £45m will be able to access the scheme, which is interest-free and fee-free for the first 12 months.