By Oliver Smith on Monday 2 November 2020
Originally scheduled to end 4 November, the Government-backed lending scheme was extended to 30 November.
Last week an influential group of MPs called on the government to quickly roll out a replacement to the Bounce Back Loan Scheme (BBLS) ahead of its closure on 30 November, today their call was echoed by lenders.
The BBLS was originally scheduled to end on 4 November, but was extended in line with the Coronavirus Business Interruption Loan Scheme (CBILS) to the 30 November, at which point Chancellor Rishi Sunak said a successor scheme was in the works for 2021.
Kevin Hollinrake MP, co-chair of the All Party Parliamentary Group on Fair Business Banking, told City AM that the BBLS should not end this month and instead should be immediately replaced by “a new iteration of the scheme… that takes us through to the middle of next year”.
Now given the prospect of a second lockdown and the fact that Starling Bank is the only business bank still open to new customers looking to apply for a Bounce Back Loan, pressure is mounting on Sunak to bring forward his plans.
“SMEs can’t afford to wait and have one concern—how are they going to survive the Covid-19 crisis and get access to the finance they desperately need,” John Davies, chairman of the Association of Alternative Business Finance and founder and executive chairman of Just Cash Flow PLC, told AltFi today.
“Forcing them to get in endless queues to open up new bank accounts is a massive and frustrating diversion for them.”
“The elephant in the room continues to be non-bank lenders inability to access the Bank of England’s Term Funding Scheme which creates a completely unfair playing field and there is no sign of a quick resolution to this.”
Davies points to the option of getting “the Government to part guarantee funding to the wholesale funders, that most non-banks rely upon, who will in turn provide the necessary liquidity to non-bank lenders”.