The devastating COVID-19 crisis caused a massive financial hit to businesses in the United Kingdom, confronting them with substantial revenue and cash flow losses. Many of them were forced to ask for support through the government-backed loan schemes to survive in the times of unprecedented economic disruption.
According to data presented by BuyShares, the cumulative value of loans that have been approved through the Coronavirus Businesses Interruption Loans Scheme (CBILS), Bounce Back Loan Scheme (BBLS), and Coronavirus Large Business Interruption Loan Scheme (CLBILs) in the United Kingdom hit £52.6bn in August.
More Than 1.2 Million Loans Approved in Four Months
The United Kingdom’s Government created a range of measures to help support businesses of all sizes throughout the coronavirus crisis. The smaller companies can apply for the Coronavirus Business Interruption Loan Scheme (CBILS), which operates through the British Business Bank via more than 40 accredited lenders. These lenders can provide up to £5 million worth financial help in the form of term loans, overdrafts, and asset finance.
The Coronavirus Large Business Interruption Loan Scheme (CLBILS) facilitates access to finance for medium-sized and larger businesses with a group turnover of more than £45 million. This scheme can provide up to £200 million worth financial help for the companies affected by the coronavirus outbreak.
The Bounce Back Loan Scheme (BBLS) allows lenders to provide a six-year term loan from £2,000 to 25% of a business’ turnover.
More from Finance
- Expert Analysis: Lockdowns Fuel Surge In Business Prepaid Card Usage
- Private Banking vs Personal Banking
- Flyfish Review – Payroll Management Simplified For Everyone
- What is a Virtual Payment Terminal?
- Top 5 Digital Banks Worldwide
- The Rise of Tech ETFs: A Gateway to Investing in the Next Big Innovations
- Psychology of Trading: Zak Westphal’s Insights on Mastering the Mental Game
- Banxe Launches Debit Card To Spend Crypto, With Free Card Offer In February
In the second week of May, the combined value of facilities approved through these three schemes amounted to £14.8bn, revealed the HM Treasury data. By the middle of June, this figure surged by 157% to £38.2bn worth of loans. Statistics indicate the total value of facilities approved through the Government-backed loan schemes hit £46.2bn by the end of the second week of July. By August 16th, this figure jumped by 14%, reaching a total of $52.6bn.
Statistics indicate the banking and finance industry has supported more than 1.2 million UK businesses with lending schemes to help them through the COVID-19 crisis.
£35.5bn Worth of Loans Approved Through the Bounce Back Loan Scheme
The Bounce Back Loan Scheme represents the most significant part of the government-backed aid package in the United Kingdom, with £35.5bn worth of loans approved by August. This scheme has been a success in providing more than 1.1 million firms with vital government-backed loans at an affordable rate with no interest or repayments due in the first year.
The HM Treasury data revealed the cumulative value of lending through the Coronavirus Business Interruption Loan Scheme reached almost £13.7bn in August or 25% of all approved loans. Statistics indicate that between May 10th and August 16th, 516 medium-sized and larger businesses in the United Kingdom received £3.5bn worth financial help thought the Coronavirus Large Business Interruption Loan Scheme.
