More businesses set to benefit from government loan scheme

Thursday July 30th, 2020

More small businesses can benefit from loans under CBILS.Government Opportunities

government expects lenders to make changes in approvals processes

over 57,000 businesses have benefitted from £12.6 billion of support through CBILS to date

Changes to state aid rules as a result of UK Government and industry lobbying mean that more small businesses can now benefit from loans of up to £5 million under the Coronavirus Business Interruption Loan Scheme (CBILS), it was announced today (30th July 2020).

Previously businesses which were classed as ‘undertakings in difficulty’ were unable to access CBILS because of EU rules. From today, businesses in this category and which have fewer than 50 employees and a turnover of less than £9 million can apply to CBILS.

The Economic Secretary to the Treasury and the Small Business Minister have written to accredited lenders setting out their expectation that these changes will be implemented to ensure more businesses are receiving support.

Undertakings in difficulty are usually businesses with high levels of debt and accumulated losses.

The UK Government and industry groups have lobbied to relax the restrictive rules in the European Temporary State Aid Framework to make sure that small businesses who are not insolvent or receiving rescue aid can benefit, enabling them to bounce back and kickstart our economy.

Businesses have benefitted from £50 billon of government-backed support with over 57,000 firms drawing from CBILS to date. This is alongside other measures in the government’s comprehensive package of support including the furlough scheme, over £10 billion of grants and generous tax deferrals.

Throughout the pandemic, the UK Government has acted with speed and at scale to protect lives and safeguard jobs.

In the first phase of this crisis the government aimed to protect lives and safeguard jobs. The second phase will see the Chancellor’s Plan for Jobs set in motion, which will see jobs created, supported and protected as the economy begins to reopen.

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