Chancellor's latest support
New loans for big companies – help likely for micro firms
Rishi Sunak: ‘I want to ensure that no viable business slips through our safety net’
Big businesses affected by the coronavirus are to get more support via a government-backed loan scheme.
All firms with a turnover of more than £45 million will now be able to apply for up to £25m. Firms with a turnover of more than £250m will have access to up to £50m.
More support is also on the way for start-ups and early stage companies who feel they have been overlooked.
The government says it that these companies are facing challenges and is working with industry to assess these and consider further ways to offer support.
The latest deal will be part of the Coronavirus Large Business Interruption Loans Scheme (CLBILS) which will be launched on Monday.
Business with turnovers of more than £500m were originally not eligible for the scheme. It is being set up to help firms who do not qualify for the existing Coronavirus Business Interruption Loan Scheme – for small and medium sized businesses – and the Bank of England Covid Corporate Financing Facility – for investment grade companies.
Expanding this scheme will provide larger firms with the support they need– Alok Sharma, Business Secretary
The move comes after extensive consultation with businesses.
Chancellor Rishi Sunak, said: “I want to ensure that no viable business slips through our safety net of support as we help protect jobs and the economy. That is why we are expanding this generous scheme for larger firms.
“This is a national effort and we’ll continue to work with the financial services sector to ensure that our £330 billion of government support, through loans and guarantees, reaches as many businesses in need as possible.”
Business Secretary, Alok Sharma, said: “Coronavirus has struck a heavy blow against businesses of all sizes across the UK. Expanding this scheme will provide larger firms with the support they need during the pandemic, helping to provide job security to thousands of people and protect our economy.”
The government will provide lenders with a guarantee of 80% on each loan to give lenders further confidence in continuing to provide finance.
The scheme will be available through a series of accredited lenders, which will be listed on the British Business Bank website.
|Turnover < £45m||Turnover > £45m||Investment grade|
|Coronavirus Business Interruption Loan Scheme (CBILS)||X|
|Coronavirus Large Business Interruption Loan Scheme (CLBILS)||X||X|
|Covid Corporate Financing Facility (CCFF||X|
Reactions from business
IoD Director General, Jonathan Geldart said: “The Government deserves credit for showing willingness to continue to adapt its coronavirus response.
“This crisis justifies exceptional measures and we need to keep the foot on the gas to get the support to the businesses that need it.”
Rain Newton-Smith, CBI Chief Economist said: “The flexibility shown by the Government in recent weeks to do all they can for businesses small, medium and large will have protected many jobs. What’s essential now is to get the loans flowing as smoothly and swiftly as possible to those businesses in need.”
BCC Director General Adam Marshall said: “Once again, it is good to see the Chancellor listening to real-world business concerns, and expanding assistance to good companies facing severe cash constraints as a result of the Coronavirus crisis.
These changes fill an important gap in government support– Adam Marshall, BCC
“These changes fill an important gap in government support, and could make a real difference to medium-sized and larger-firms navigating challenging circumstances. It’s now crucial to ensure that this enhanced support reaches companies in difficulty as quickly as possible.”
The Business Secretary and the Economic Secretary to the Treasury will co-chair a meeting of the Business Finance Council on Friday to discuss the progress so far of the CBILS, and provide an update on CLIBLS.
It will be attended by Small Business Minister Paul Scully and representatives from UK Finance, the Finance & Leasing Association, British Chambers of Commerce, Institute of Chartered Accounts of England and Wales, the Federation of Small Businesses, British Business Bank, Barclays UK, Bibby, CYBG, HSBC UK, Lloyds Banking Group, NatWest Group, Santander UK and Funding Circle. The Small Business Commissioner Philip King will also attend.