The UK government’s emergency loans scheme for businesses struggling to survive amid the coronavirus pandemic has been revamped following strong criticism, a media report said on Friday.
The changes to the business interruption loan scheme will mean more businesses were able to access financial support during the lockdown, the BBC report said.
Previously, government-backed loans for small businesses were only available to firms that had been turned down for a commercial loan from their bank.
That saw businesses being asked to pay interest rates of as much as 30 per cent.
Following the changes to the scheme, applications will not be limited to businesses that have been refused a loan on commercial terms.
However, the Treasury did not put in place restrictions on the interest rates that banks can charge for loans.
Larger firms with a turnover of up to 500 million pounds will also be eligible for more help.
The revamped scheme will offer government-backed loans of up to 25 million pounds to firms with revenues of between 45 million pounds and 500 million pounds.
“We have also listened to the concerns of some larger businesses affected by COVID-19 and are announcing new support so they can benefit too,” the BBC quoted Chancellor Rishi Sunak as saying.
Banks will also be banned from asking company owners to guarantee loans with their own savings or property when borrowing up to 250,000 pounds.
“We are making great progress on getting much-needed support out to businesses to help manage their cashflows during this difficult time – with millions of pounds of loans and finance being provided to hundreds of firms across the country,” Sunak said.
“And now I am taking further action by extending our generous loan scheme so even more businesses can benefit.”
The UK has so far reported 34,173 with 2,926 deaths.
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