Speed is Vital With CBILS Applications

Struggling with a CBILS Application? Speed is of the Essence. Why Not Try Your Accountant or a Specialist Provider?

There has been much controversy surrounding the Government’s Coronavirus Business Interruption Loan Scheme, not least because of reports that the High Street Banks, who are the main accredited lenders for the Scheme, are charging too much interest on the loans and/or are asking directors for Personal Guarantees. In addition, many have complained that the loans are taking too long to process leading to only about 1,000 loans totalling £90 million being approved by 2nd April. So, it seems that what looked like such a good and welcome scheme isn’t working well in practice – certainly not working quickly enough.

As insolvency practitioners, our task, particularly in the current crisis, is to give struggling businesses all the help and advice they need to restructure in order to survive and get through these extremely difficult times. As we have said in an earlier article the UK cannot afford for tens of thousands of businesses to go bust. In this article we welcome moves made by the Chancellor to clarify and improve the CBILS scheme and suggest that it might well be quicker for directors to get their accountant or a specialist provider to handle a CBILS application on their behalf.

The Chancellor’s Response to Criticism of the Banks

The Chancellor has made it clear to the lenders that The Treasury will ban lenders from requesting personal guarantees for loans under £250,000, and that whilst personal guarantees for facilities above £250,00 can still be requested, they must exclude the principal private residence and that recoveries are capped at 20% of the outstanding balance of the CBILS facility after the proceeds of business assets have been applied. In addition, it was also reported that “operational changes” to speed up lending approvals would follow.

It has not been made clear yet what these “operational changes” are, but in our view, speed is entirely of the essence in getting many thousands more CBILS approved. This is essential if a massive raft of insolvencies is to be avoided in the next few days and weeks.

Our Insolvency Practitioners Suggest Using Your Accountant or a Specialist Loan Provider to Make Your Application – Time is Crucial Right Now

Making an application for a standard loan can be a slow process in ‘normal’ times, and making a mistake on the application form, or not having all the numbers readily available when the bank starts asking questions can slow things down even more.

Right now, with the banks honing their own systems for reviewing and processing CBILS’ applications, the last thing that any business applying for one needs is for it to be slowed down because mistakes were made in the application process.

For that reason, if businesses come to us to ask asking for help and advice over a CBILS application, our insolvency practitioners will advise them to talk to their accountant. They will already know about the business and should be experienced in the process of loan applications.

However, if your accountant cannot help you, then we advise talking to a specialist broker or business development and support provider, with experience and expertise in the arena of loans.

We know of a number of these that offer such a service, which is often quicker than going direct to banks, as they know what the banks want and what they are looking for, reducing the chances of delay at the banks’ end.

One such specialist provide that we would recommend is London based Growbridge, who are already managing applications for CBILS for new and existing clients, and who have good working relationships with Nat West, HSBC, Barclays, Lloyds & Metro Bank.

Contact Our Insolvency Practitioners Now About Help with CBILS Applications

There are other specialists in addition to Growbridge that we know and trust to whom we can point businesses for help with CBILS applications through our individual offices. For more information, please contact: