Limited access to Bounce Back Loans
Business groups have warned that limited uptake of the Government’s new Bounce Back Loan Scheme (BBLS) by banks may leave small firms at risk of missing out on support they are entitled to. Currently, just eight banking groups are authorised to process applications for the scheme, with most restricting loans to their existing business customers, raising the possibility that small businesses needing finance will struggle to obtain loans unless they bank with one of the larger lenders. Suren Thiru, head of economics at the British Chambers of Commerce, said the low number of accredited lenders was “troubling,” as it “could see firms who use other lenders effectively locked out of the scheme.
Mr Thiru has called on the Government and the British Business Bank to ensure “the scheme has sufficient capacity to meet demand,” including “an expedited process for accrediting new lenders, including specialist non-bank lenders such as fintech firms.” Elsewhere, Federation of Small Businesses chair Mike Cherry has insisted on full transparency over the loan scheme, saying accredited banks “should be publishing details on applications, approvals and declines – as well as the speed with which money is reaching accounts after approval”. Alternative lenders have asked the Bank of England for funding support, saying the scheme will hurt competition in the small business loans market.
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