UPDATE: The government has taken steps on the Coronavirus Business Interruption Loan Scheme (CBILS) to ensure that lenders have the confidence they need to process finance applications quickly, including removing the per lender portfolio cap for the government guarantee, and changing the viability tests that so that all banks will need to assess is whether a business was viable pre COVID-19
Chancellor of the Exchequer Rishi Sunak, has bolstered business interruption loans to support firms affected by coronavirus.
To maximise the support available, the Chancellor is extending the CBILS so that all viable small businesses affected by COVID-19, and not just those unable to secure regular commercial financing, will now be eligible should they need finance to keep operating during this difficult time.
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) will now ensure that more firms are able to benefit from government-backed support during this time.
CLBILS will provide a government guarantee of 80% to enable banks to make loans of up to £25 million to firms with an annual turnover of between £45 million and £500 million. This will give banks the confidence to lend to more businesses which are impacted by coronavirus but which they would not lend to without CLBILS. Loans backed by a guarantee under CLBILS will be offered at commercial rates of interest and further details of the scheme will be announced later this month.
PPA MD Owen Meredith commented: “These changes to CBILS are very welcome and will hopefully ensure banks are able to advance finance under the scheme to more publishers and businesses in desperate need of finance to see them through this crisis. The expansion of the scheme to include business with a turnover of up to £500m, who could not access to Bank of England Corporate Finance Scheme, is very welcome news. PPA have been in regular contact with DCMS, BEIS and Treasury officials to help improve the scheme following concerns raised by members about access to finance and I am pleased that the government has listened to business and responded accordingly.”