Government emergency loans soar to nearly £35billion
By Rob Freeman | 10th June 2020
Bounce back loans account for the biggest chunk of the growing cost of emergency government help during the coronavirus pandemic.
Latest Treasury figures said the total cost of the emergency schemes had risen to almost £34.9billion by June 7.
The Bounce Back Loan Scheme, which helps the smallest business with loans of up to £50,000 backed by a 100 per cent government guarantees, has seen £23.78billion paid out since it was launched last month.
That is an increase of £2.45billion in the last week.
The cost of the Coronavirus Business Interruption Loan Scheme rose by £640million to £9.6billion while the Coronavirus Large Business Interruption Loan Scheme has seen more than £1.5billion issued.
More than 228,000 applications for the schemes were pending at the start of this week.
Business advisors have warned companies to think carefully about how best to use the money they may have been awarded.
Richard Neale, director of Staverton-based business support company OPS-BOX Group, said planning was key to highlighting the best options.
He said: "We were talking to someone about sustainability and there's a very good challenge out there - if you are sat on some money, could you seek to make your business more sustainable? More environmentally conscious?
"They are open-ended questions but some businesses can absolutely do that and are well positioned to do that."
And Will Abbott, partner at Shurdington-based accountants Randall & Payne, believes the money can be used for more than just survival through the pandemic.
Writing for Punchline-Gloucester.com, he said: "The Government has provided the financial lifelines to help your business through these abnormal times and using the funds simply to manage your cashflow is missing a big opportunity to protect the future of your business.
"Investing time now to save your business, to future proof it and adjust to the new normal is far better than having to start again.
"By taking action you will ensure you both survive and thrive."
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