Make UK has praised the recent changes made to the Coronavirus Business Interruption Loan Scheme (CBILS), but has said more can still be done to help subsidiaries.
Chancellor Rishi Sunak made changes to the CBILS, meaning that applications will not be limited to businesses that have been refused a loan on commercial terms, but the Treasury has not capped the interest rates banks can charge.
Banks will also be banned from asking company owners to guarantee loans with their own savings or property when borrowing up to £250,000.
Larger firms, will a turnover of up to £500 million, will also be eligible for more help, with state-backed loans of up to £25 million available to businesses with revenues of between £45 million and £500 million.
Stephen Phipson, CEO of Make UK, said: “Manufacturers will welcome today’s announcement by the Chancellor. Since the initial proposals were put forward companies have expressed concern about the availability of finance and the degree of security being demanded by lenders, and the Treasury has listened to this feedback and taken swift action.”
“It’s also clear that many companies were sitting in the squeezed middle between the loan scheme and the Bank of England’s Corporate Finance Facility and today’s announcement will provide these companies with further reassurance.”
“However, further clarification is still needed on the treatment of UK-based SMEs which are subsidiaries of larger groups. We are hearing of many companies being denied CBILS loans because of this which has to stop.”
“Manufacturers across the UK have been struggling to access urgently needed support, and we hope this announcement means that the tap is now turned on.”