Summing up the market from our various conversations with Banks, Finance Houses and Accountants
Latest Coronavirus Government Lending Figures
|Scheme||Value of facilities approved||# of facilities approved||Total number of applications|
|Bounce Back Loan Scheme (BBLS)||£21.29bn||699,354||873,192|
|Coronavirus Business Interruption Loan Scheme (CBILS)||£8.92bn||45,843||89,724|
|Coronavirus Large Business Interruption Loan Scheme (CLBILS)||£1.11bn||191||579|
*As per the latest official figures reported to the Treasury at close of play on 31st May
Looking at the above figures in more detail, we have seen the following differences from last weeks data:
Week on Week Comparison: Close of business 24th May – 31st May
|Scheme||Increase in applications since 24th May||Increase in approved applications since 24th May||Increase in value of approved applications since 24th May|
|Bounce Back Loan Scheme (BBLS)||104,055||91,285||£2.8 billion|
|Coronavirus Business Interruption Loan Scheme (CBILS)||5,117||2,798||£0.77 billion|
|Coronavirus Large Business Interruption Loan Scheme (CLBILS)||77||37||£0.29 billion|
The latest figures show the smallest week to week increase in applications for Bounce Back Loans since the initiative began, with an increase of 104,055 applications from the previous week. For CBILs applications there was a marginal increase from the previous week, however it appears applications for government funding schemes are beginning to plateau and fall as the weeks progress.
On the whole, the response from lenders in terms of the number of loans they have approved has been impressive and certainly a number of the clients we have spoken to have had a positive experience with bank and relationship managers at lender firms doing everything they can to help. This pandemic has thrown up many negative news stories however it is important to note that, especially with Bounce Back Loans, participating lenders will not profit from the scheme and their participation and efforts in supporting SME businesses should rightly be commended.
That being said, a weekly SME Health Tracker from ACCA (Association of Chartered Accountants) showed some concerning findings:
23% of SMEs are unable to access cash to last another two weeks of lockdown
14% of SMEs won’t have access cash to last four weeks of lockdown
5% intend to dissolve, up from 4% on last week’s findings
Whilst the experience with government funding schemes has been positive for some, for others sourcing much needed finance has proved more difficult. Clients we have spoken to have voiced their frustrations with access to cash not happening quickly enough and having a significant affect on cashflow, whilst others have experienced delays with applications or refusal of applications all together. It’s key to point out that one of the stipulations of the government lending schemes was that applicants ‘would be a viable proposition in the long-term were it not for the Covid-19 Pandemic’.
If your business falls into this category, please do get in touch with us or speak with your financial advisors to strategise your way forward. There are options available that can improve your situation and although they may not all be your desired outcome, they can help to ensure your business survives this period.
This weeks advice tips include:
- Make time for webinars and researching the market – At The Business Board, we have been regularly attending webinars and online events to keep in touch with different sectors and how they have been affected by this pandemic. Being largely sector agnostic in terms of the clients we deal with, that may not come as a surprise. There is often great value however in getting different perspectives from different industries & sectors and understanding their challenges/concerns and identifying the synergies with your business in that respect. The work may be different but many businesses face the same or similar challenges to your own business and much can be learned from their approaches and solutions.
- Take time to strategise – The last couple of months have no doubt been difficult to do anything other than focus your time and attention on productivity and cashflow. Many of the clients we have spoken to have been ‘fighting fires’ and have simply had very few opportunities to take a step back and comprise a strategy going forward. It’s vitally important you do take that time away from the ‘front line’ and clear your schedule to get some thinking space. The days of 5 year plans may be long gone but knowing where you want your business to be at the end of this year is imperative. Do you have a finance facility that is flexible enough to see you through but also capitalise on any opportunities that may arise? Are your processes and systems up to date and as efficient as they need to be? Do you have the infrastructure in place to ‘pivot’ your business in the areas you are planning to do so? This pandemic is incredibly difficult to predict in terms of the economic and business impact it will have in the short term. As the old saying goes… ‘if you don’t take change by the hand, it will take you by the throat’
- As always, its the same message from us each week; ensure you have a detailed picture of your business and how it has been affected by COVID-19 in place to ensure any funding application is processed quickly: Lending Criteria Tips
Good luck and stay safe, and do let us know if you would like help with any of the above.
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call us: 0118 338 1818