Less than 10% of businesses can access government coronavirus funding #SmallBiz - The Entrepreneurial Way with A.I.

Breaking

Wednesday, April 8, 2020

Less than 10% of businesses can access government coronavirus funding #SmallBiz



Originally written by Anna Jordan on Small Business

New figures show that most small businesses can’t access the government’s emergency coronavirus funding despite wanting to take advantage of it.

One set of statistics from UK Finance reveals that just 2,022 loans have been made to UK SMEs through the government’s Coronavirus Business Interruption Loan Scheme (CBILS), with less than 1pc of enquiries resulting in these loans.

Meanwhile, the Corona Business Impact Tracker from the British Chamber of Commerce (BCC) measures the impact of coronavirus on businesses as well as the effectiveness of the government’s emergency actions. The latest polling took place from 1-3 April and received 1000 responses.

The tracker shows that awareness of the schemes is high: 59pc knew about the CBILS and 19pc planned to use it. Fewer business owners (42pc) knew about the grants available to small businesses and 24pc planned to use it.

Polling numbers say that 8pc of respondents were unsuccessful in getting access to the CBILS. They cite that the application process was slow and that they couldn’t get responses from the relevant body. The BCC is optimistic that successful applications will increase in the coming weeks.

As for the grant schemes, 7pc of respondents were using them at the time of the survey. However, twice as many (14pc) had been unsuccessful. Of those who couldn’t get a grant, 83pc said they didn’t meet the criteria, 14pc said they had slow or no response from the relevant body and 8pc said there was insufficient or no information available.

Cash flow is, unsurprisingly, an urgent concern for SMEs. Some 41pc of respondents had between one and three months’ cash, 16pc had less than a month’s worth of cash left and only 5pc had at least 12 months in reserve. Worryingly, 6pc have already run out of money.

Staff are being widely affected by this issue. A substantial 37pc of business owners said that they’re planning to furlough 75pc to 100pc of their workforce over the coming week.

Loan applications climbing

That said, the situation has picked up since the government loosened criteria for loans and banned banks from seeking personal guarantees from small businesses. Simplifying the system has allowed faster rates of approval.

>See also: How do I apply for a Coronavirus Business Interruption Loan?

BCC director general, Dr Adam Marshall, said:

“We are pleased that the chancellor is listening and responding to our calls to strengthen the existing support. Improvements to the CBILS scheme should help more businesses get access to the cash they need over the coming days and weeks. This could be the difference between survival and insolvency for many firms.

“It’s vital that governments across the UK continue to work closely with business over the coming days. Every minute counts, and governments, local authorities and banks must do everything in their power to ensure support gets to firms on the front line more quickly.”

If you’ve had a hard time getting hold of the government’s emergency funding, you may have other options. William Garvey, managing director at Leyton UK, said:

“Businesses must explore every avenue for funding during this period. While there are bottlenecks for government loan schemes, HMRC are continuing to process claims for R&D tax credits at normal speeds. This can be a good line of relief for businesses to pursue if they are eligible and businesses may be able to claim thousands of pounds at a time when cash flow has never been more crucial.”

Read more

How is your bank helping your small business through coronavirus?

Less than 10% of businesses can access government coronavirus funding


via https://ift.tt/2Jn9P8X by Anna Jordan, Khareem Sudlow