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UK government to expand Covid-19 rescue loan scheme

The government is expanding its Covid-19 rescue loan scheme to cover small businesses on the edge of collapse, a move that Labour warned would come too late for many troubled firms.

With less than a week before the furlough scheme covering 9 million employees is cut back, plunging more employers into debt, the Treasury said it would use a change in EU state aid rules to allow firms previously locked out of the coronavirus business interruption loan scheme (CBILS) to access government funds.

The economic secretary to the Treasury, John Glen, said he would write to major lenders advising them of the change, which will make more small businesses – specifically those that have racked up large losses and debts – eligible for loans of up to £5m. By the end of June, more than £11bn had been lent to more than 50,000 businesses under CBILS.

1pm plc (LON:OPM), established in 2006 is an independent provider of finance facilities to the SME sector. The 1pm plc group offer a full range of business finance solutions to the UK market from asset finance, hire purchase, commercial loans through to invoice finance and factoring.

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Disclaimer: Statements in this article should not be considered investment advice, which is best sought directly from a qualified professional.