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Locked out of Covid-19 loans? This could help

The government’s financial support schemes are helping many small businesses, but at the same time, there are firms that are finding themselves locked out of these loan plans. The question is, how can locked-out businesses keep going?

The Chancellor has unveiled his Winter Economy Plan, central to which are a number of measures designed to continue supporting small businesses. These include the launch of the new Job Support Scheme and the extension of Coronavirus Business Interruption Loan Scheme and the Self Employment Income Support Scheme. In addition, businesses will be able to repay government loans on much more flexible terms.

The new measures have been widely welcomed, but there has been some criticism, in particular from those that are claiming that the measures don’t go far enough and from those that can’t access the government’s emergency business support schemes.

With regard to the criticism, there has been a call for more help for employers, rather than just employees, and high-street lenders have come under fire from MPs for their handling of Bounce Back Business Loans scheme applications. The politicians have singled out the banks for inconsistent and incompetent practices with regard to the scheme.

Furthermore, the Chancellor has also come under attack from sections of the self-employed workforce, which are claiming that they have been excluded from the new support schemes. It has been reported that as many as three million freelancers, limited firms, PAYE employees, new starters and women on maternity leave have been left out.

What locked-out businesses can do to access funding

It remains to be seen whether the government will extend the coverage business finance support schemes to fill in the gaps mentioned above and act to ensure better practices from lenders. With regard to former, the Chancellor did make changes to his initial support schemes, so there is some hope for those currently excluded.

However, these firms and individuals need help now and this is why it is critical that business owners and the self-employed are aware of all the funding options available to them, from the government’s various financial support schemes to the services of alternative lenders.

Keeping afloat into 2021 and how alternative finance can help

With regard to alternative finance, in the wake of prolonged caution from traditional lenders and at a time of extraordinary economic contraction, facilities such as invoice finance, asset finance, peer-to-peer lending and crowdfunding are proving a vital source of capital for small businesses, both for safeguarding cashflow and for essential investment. These facilities, which offer a more personalised approach to lending, are helping small businesses survive and grow.

Tellingly, alternative finance is playing a key role in the government’s Covid-19 business support strategy, in particular with regard to the Coronavirus Business Interruption Loan Scheme, which offers access to a range of finance facilities, including alternative finance services.

What business owners need to know about finance options

The introduction of new coronavirus restrictions and the coming of the winter months point to more hard times for small business owners and self-employed workers. For those that are locked out of Covid-19 loan schemes, it is absolutely imperative that they are aware of all the business finance services that are available to them, including alternative finance facilities.

To find out more about A&T Business Associates services, contact Steve Bowles on 01903 602211 or steve.bowles@atbusinessassociates.co.uk.

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