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Chancellor Rishi Sunak offering firms loans up to £50,000 within days of applying aims to unlock a backlog of credit checks

New micro business loans to “give hope to thousands”, as £50,000 limit and 100% guarantee unveiled today

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Responding to the announcement that the Government is establishing a new micro loan scheme for small businesses, encompassing a 100% government guarantee on facilities worth up to £50,000 (capped at 25% of turnover) and a streamlined application process. We reached out to Federation of Small Businesses (FSB) National Chairman Mike Cherry to find out more about the interruption loan scheme announced today.

“To date, the existing interruption loan scheme has not been working for the small firms that make-up 99% of our business community. The decision by the Chancellor to listen to our recommendation for a 100% guarantee on smaller loans, alongside the creation of a new fast-track system for those applying for them, will give hope to thousands.”

Established 45 years ago, FSB is the UK’s largest grassroots business campaigning group, and the voice of small businesses during the Covid-19 outbreak. With the aim to help smaller businesses stay afloat, the loan is the oxygen thousands of businesses need to survive the lockdown and the results of FBS’s lobbying at the highest level across the UK.

“The headline terms will be hugely welcomed by the sole traders and micro businesses that make-up 95% of the small businesses community. Removing the need to provide forecasts marks an important step forward – small firms cannot be expected to predict the future in this climate.  

From here, we need the right delivery. The new fast-track system must be established by next Monday with money delivered 24 hours after a successful application as promised. All those who have been declined a small coronavirus business interruption loan scheme (CBILS) facility should now be written to with the offer to re-apply via this new system. Those mid-way through a standard CBILS application should also be given the option to change tack.”

Responding to the announcement that the Government is establishing a new micro loan scheme for small businesses, encompassing a 100% government guarantee on facilities worth up to £50,000 (capped at 25% of turnover) and a streamlined application process. We reached out to Federation of Small Businesses (FSB) National Chairman Mike Cherry to find out more about the interruption loan scheme announced today.
Chancellor Rishi Sunak announced the new micro business loans scheme to give hope to small businesses across the UK

Small businesses are the backbone of the local economy and the seismic shift of apathy during the lockdown, not only changed consumer behaviour but closed the doors to the every local gym, bookstore, barber and nail salon.

“Many small businesses have had to pay March and April’s payroll, on top of other overheads, with no revenue coming in at all. The CBILS initiative was their only lifeline until job retention scheme payments kicked in. It has so far proved to be extremely difficult to access for the vast majority. Today’s announcement promises to change that fundamental lack of access to working capital.

Our own research shows that thousands of small businesses are creating new strategies to contribute to the survival of their local community and entrepreneurs are working hard to set its future direction, but while they don’t hold the answer they are definitely part of the solution.

Capturing this insight from National Chairman Mike Cherry, Sovereign congratulates FSB for the successful campaign on protecting small business survival during the lockdown. It is critical that the government finds creative ways of resolving the challenges small businesses are facing across the country and we are relieved to bring the good news.

The new “microloan scheme” is available as soon as next week and it is designed to provide a “simple, quick, easy”loan. Chancellor Rishi Sunak told the House of Commons the scheme is offering firms loans up to £50,000 within days of applying. As banks have come under fire for not supplying the working capital under recent lending schemes, alternative lenders could contribute to the cash flow solution.

“In the long-term, we need to protect the competition achieved in the small business lending market that so many have fought so hard to secure. At the end of this crisis, non-bank lenders are going to be key to economic recovery as part of a thriving small business finance market that does not just rely on the big five banks. We look forward to working with the Government to ensure alternative lenders can play that vital role.

Equally, the big banks must ensure they’re in a position to facilitate a large a number of small business loans. Some of their systems are already creaking under the strain, before this new system is brought in on top. Some lenders have been unable to facilitate such lending because they have not got their backroom operations in order. This issue requires urgent attention.”

Responding to the announcement that the Government is establishing a new micro loan scheme for small businesses, encompassing a 100% government guarantee on facilities worth up to £50,000 (capped at 25% of turnover) and a streamlined application process. We reached out to Federation of Small Businesses (FSB) National Chairman Mike Cherry to find out more about the interruption loan scheme announced today.
The New micro business loans for small business as £50,000 limit and 100% guarantee are unveiled today

Founder Dr Nani is the Founder of Sovereign Magazine. She is also Editor-in-Chief of Sovereign’s sister publication, Rich Woman Magazine. Passionately advocating for Social Edification, Dr Marina Nani is coining a new industry, MAKE THE NEWS ( MTN) with the aim to diagnose and close the achievement gap globally. Founder of RICH WOMAN SOCIETY™ Marina believes that there is a genius ( Stardust) in each individual, regardless past and present circumstances; “not recognising the talent in each individual, leaves our society at loss. Sharing the good news makes a significant difference on your perception about yourself, your industry and your community.”

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