Will this unlock and/or accelerate access to financing?
- Greater flexibility for banks to apply scheme: Removal of the requirement to exhaust other funding options prior to accessing CBILS should provide greater flexibility for lenders to assess and apply the scheme up front.
- Structures: We expect lenders to continue to standardise products offered to customers to support faster implementation.
- Timing: Should support further streamlining of credit processes / decision making, noting the continued challenge presented by the volume of requests being made.
- An automated process is also being introduced for loans up to £30k to increase speed and free up banking capacity for larger CBILS loans.
- Pricing: Lenders being asked to take into account government support when evaluating pricing.
What practical steps should companies take to access the Scheme?
- Companies should still approach lenders to access incremental funding needs.
- Lenders will determine whether / how to apply the Scheme
- A well-structured funding request will be central to the success / speed of outcome, demonstrating:
- Financial viability of the business pre-COVID-19 (pre-1 March 2020).
- Robust plan and actions to manage through COVID-19 interruptions / impacts.
- Deliverable path to restoring financial strength and repay loans post COVID-19 crisis.
- Backed by well-grounded cashflow projections and scenarios.
- Acting fast remains paramount to meet required funding timescales given the volume of requests being managed by lenders.
Official information from Government is available on their website here.