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Opinion

Chancellor Rishi Sunak offers 'good and grim' news to companies, says Business West managing director

Phil Smith, managing director of chambers Business West, reflects on Rishi Sunak's latest announcements

Chancellor Rishi Sunak during a media briefing in Downing Street, London, on coronavirus (COVID-19)(Image: PA)

It was good and grim news from chancellor Rishi Sunak as Boris Johnson stepped back into Downing Street and the debate over relaxing the lockdown.

The good news will be very welcome by small business so worried about the delays experienced by many of them in applying for cash through the government’s much-heralded Coronavirus Business Intervention Loans Scheme (CBILS).

On top of the delays, the loans only carried an 80 per cent guarantee by government.

So, having listened to the complaints from small business struggling to survive, the chancellor’s team have developed a new, quick micro-loan scheme with 100 per cent government backing.

It starts on Monday (May 4) at 9am and small businesses will be able to apply for these new bounce back government loans for 25 per cent of their turnover up to a maximum of £50,000 with the government paying interest for the first twelve months.

Phil Smith of Business West(Image: Bristol Live)

The chancellor said there would be no forward-looking tests of business viability and no complex eligibility criteria - just a simple, quick standard form for businesses to fill in.

He also made assurances that for most firms the loans should arrive within 24 hours of approval, saying that he knew some small businesses were still struggling to access credit.

He said: “If we want to benefit from their dynamism and entrepreneurial spirit, they will need extra support to get through this crisis.”