Originally slated to end on November 4, the government-backed loan program has been extended until November 30.
Image source: Rishi Sunak / The Treasury.
Last week an influential group of MPs asked the government to quickly roll out a replacement to the Bounce Back Loan Scheme (BBLS) before it closes on November 30, today their call was echoed by lenders.
The BBLS was originally scheduled to end on November 4, but was extended under the Coronavirus Business Interruption Loan Program (CBILS) until November 30, when Chancellor Rishi Sunak said a successor program was ongoing for 2021.
Kevin Hollinrake, MP, Co-Chair of the All-Party Parliamentary Group on Fair Banking, Told City AM that the BBLS is not expected to end this month and should instead be immediately replaced with “a new iteration of the program … which will take us through the middle of next year”.
Now, given the prospect of a second lockdown and the fact that Starling Bank is the only investment bank still open to new clients wishing to apply for a Bounce Back loan, pressure is mounting on Sunak to move its plans forward.
“SMEs cannot afford to wait and have a concern: how will they survive the Covid-19 crisis and access the finance they desperately need” John Davies, president of the Association of Alternative Business Finance and founder and executive chairman of Just Cash Flow PLC, told AltFi today.
“Forcing them to stand in endless lines to open new bank accounts is a massive and frustrating diversion for them.”
“The elephant in the room continues to be the inability of non-bank lenders to access the Bank of England Term Funding Scheme which creates a completely unfair playing field and there is no sign of a quick resolution to this.
Davies discusses the option of “getting the government to partially guarantee funding to wholesale lenders, which most non-banks rely on, who in turn will provide necessary liquidity to non-bank lenders.” “.