The government has indicated that it plans to launch a permanent scheme that would see small firms receive long-term loans, which would replace the current COVID-19 support schemes.
This idea would see small firms able to apply for loans next year that range in scale from thousands of pounds to £10 million, which would need to be repaid over a period of six years. The plan would see 80% of the amount loaned to each business guaranteed by the government, and it is being described by some as a kind of extension to the existing Coronavirus Business Interruption Loan Scheme (CBILS), only with the threshold set lower than £10,000.
A report published in the Financial Times indicated that the rate of interest repayable on each loan would be decided by individual banks. However, it also stated that the government will likely impose a limit of 15% that the banks can charge. This is the same rate of interest as that of the CBILS, but well above the 2.5% interest rate limit for the Bounce Back Loans Scheme (BBLS) also set up by the government.
Speaking to Small Business, Douglas Grant from Conister said:
“This more permanent financial support from the government will be welcome news to those resilient SMEs that have already shown extraordinary levels adaptability and strength in the face of changing consumer behaviour.”
In addition to the various state support schemes, some firms are also looking to a small business accountant in Goole and other parts of the country for help.