Over £22 billion provided to half a million businesses through Covid-19 lending schemes

Figures published by HM Treasury today [1] show that the banking and finance industry has approved over £22 billion in loans to over half a million (505,040) businesses so far through the three major government-backed lending schemes.

In the past week alone lenders have provided over £7 billion to businesses through the Bounce Back Loan Scheme (BBLS), the Coronavirus Business Interruption Loan Scheme (CBILS) and the Coronavirus Large Business Interruption Loan Scheme (CLBILS). Bank of England data [2] shows that this is around seven times the average weekly value (£1 billion) of all new loans approved for SMEs in the year to February 2020.

Lenders have provided £14.18 billion through the BBL scheme in the two weeks since its launch, rising by £5.8 billion in the past week. The number of loans approved has increased by over two-thirds (73 per cent) to 464,393, meaning that on average over 33,000 loans have been granted each day since the scheme launched on 4 May.

£7.25 billion has been approved to 40,564 businesses through the CBIL scheme. Lenders are also helping those small businesses who have both begun and completed applications for loans of up to £50,000 through this scheme to switch to a Bounce Bank Loan should they wish.

The number of mid-sized and larger UK businesses who have received financial support through the CLBIL scheme increased to 86, with total lending of £590 million. Changes announced by HM Treasury this morning mean that businesses will now be able to apply for loans of up to £200 million through CLBILS.[3]

The number of lenders accredited by the British Business Bank under the schemes continues to rise. Businesses can now access finance through CBILS from nearly 70 providers and BBLS from 17 lenders, giving firms a wide range of choice from high street banks to alternative finance providers.

The government-backed schemes sit alongside a broad package of measures which are available to businesses from the banking and finance sector. This extensive support includes working capital facilities, overdraft extensions, capital repayment holidays and asset-based finance, allowing businesses to access the support that's most appropriate to their needs.

Stephen Jones, Chief Executive of UK Finance, said:

The banking and finance industry is committed to helping businesses get through these tough times, with over £22 billion of lending provided to almost half a million businesses through government-backed schemes so far and a further £18.8 billion drawn under bank arranged commercial paper facilities.

"Banks stand ready to support businesses large and small, and the changes announced by HM Treasury means firms can access loans from £2,000 to £200 million through the coronavirus loan schemes.

"These are just one part of a range of measures from the industry available to businesses including extended overdrafts, capital repayment holidays and asset-based finance.

"It's important to remember that any lending provided under government-backed schemes is a debt not a grant, and so firms should carefully consider their ability to repay before applying. 

Case studies: Bounce Back Loan 

  • The Greyhound Inn, Hotel Pub
    The Greyhound Inn, a hotel pub in Usk, Monmouthshire, lost its income overnight when the coronavirus pandemic struck as it was moving into the busy Spring season. The business was provided with a £50,000 Bounce Back Loan from Barclays to help ensure supplier relationships are maintained and pay staff and creditors. This will also mean the business is better placed for when the time comes to re-boot their business after the crisis.
  • Red Squirrel Self Storage - self-storage facility in Cumbernauld and Broxburn
    Red Squirrel Self Storage, based in Cumbernauld and Broxburn, secured a Bounce Bank Loan from Lloyds Bank within 24 hours of applying. The funding will allow for investment in new technology to enable customers to visit their storage units without in-person interaction and maintaining social distancing. 

Case studies: Coronavirus Business Interruption Loan

  • D.J Newman Joinery Limited - wood product manufacturer in Cornwall
    D.J Newman Joinery Limited, a wood product manufacturer in Cornwall, was provided with a CBILS loan from Barclays to provide working capital to help mitigate with the impact of COVID-19. The loan will help pay suppliers, and also help the business to come out of hibernation and begin to fulfil orders once more.
  • Rakkaus Furniture Ltd - commercial furniture provider in Kilmarnock
    Rakkaus Furniture Ltd is a commercial furniture provider based in Kilmarnock. Established in 2017 it supplies and installs furniture to offices, hotels, bars, restaurants, cinemas, schools and hospitals. Rakkaus has secured a CBILS loan from Clydesdale to cover ongoing business costs, such as rent and utilities, and to build a new website to take online orders and open the business to retail customers.
  • R Howard - pharmaceutical and food packaging manufacturer in Peterborough
    R Howard, a pharmaceutical and food packaging manufacturer based in Peterborough, has received a £300k loan from Lloyds Bank under the CBIL scheme. The business has remained open as it is deemed essential, due to the work it does in the pharmaceutical and food industries, however order volumes have dropped so the funding is being used to support working capital and the trial of new product lines.
  • Wallace Print Limited - printing firm in Rochester
    Wallace Print Limited, a printing firm in Rochester, received a CBIL scheme loan from Barclays to support its short term cash flow, while the business has stopped trading temporarily during the pandemic. The loan has enabled them to remain operational during this difficult time and come out the other side, as well as continue with their growth plans.

Case studies: other lending

  • RDP Group - medical equipment manufacturer in West Sussex
    RDP Group is a medical equipment manufacturer based in West Sussex that has designed and created a special bedside cart for the NHS Nightingale hospitals. It has an overdraft and working capital facility from Lloyds Bank which has supported cash flow to fulfil the NHS order. 
  • Alresford Garage  - garage in Colchester, Essex
    Alresford Garage in Colchester, Essex was provided with immediate support from Barclays in the form of a capital repayment holiday. Two commercial mortgages were combined into a single mortgage so the business was eligible for a six month capital repayment holiday.

For more information please call the UK Finance press office on 020 7416 6750 or email press@ukfinance.org.uk

Area of expertise:

Notes to editor

<p>UK Finance is the collective voice for the banking and finance industry. Representing more than 250 firms across the industry, we act to enhance competitiveness, support customers and facilitate innovation.</p>
HM Treasury data on lending under the CBIL, BBL and CLBIL schemes is available <a href="https://www.gov.uk/government/publications/latest-figures-show-millions…;. Figures show cumulative applications and approvals up to close of business on 17 May 2020 by accredited lenders, as reported to HM Treasury by close of business 18 May. Previous UK Finance data publications on lending under the CBIL scheme were based on data submitted by UK Finance members only. The Government intends to publish data on lending under the CBIL, BBL and CLBIL schemes going forwards. For further details please contact the HMT press office on <a href="mailto:pressoffice@hmtreasury.gov.uk">pressoffice@hmtreasury.gov.uk</a>…;
Bank of England <a href="https://www.bankofengland.co.uk/statistics/tables">data</a&gt; shows the total value of gross loans from all banks and building societies across a broad range of products ranged between £4 and 5 billion per month in the year to February 2020. This equates to an average of around £1 billion of lending per week. </li>
HM Treasury has <a href="https://www.gov.uk/government/news/larger-businesses-to-benefit-from-lo…; changes to the Coronavirus Large Business Interruption Loans Scheme (CLBILS), including increasing the maximum loan size available under the scheme from £50 million to £200 million.</li>
The Bank of England has <a href="https://www.bankofengland.co.uk/news/2020/may/update-to-the-covid-corpo…; that the Covid Corporate Financing Facility (CCFF) has so far supported £18.8bn of lending to 55 businesses. </li>
UK Finance issued a <a href="https://www.ukfinance.org.uk/press/press-releases/uk-finance-issues-joi… statement</a> on behalf of the seven largest SME lenders in response to the Chancellor?s announcement of changes to the Coronavirus Business Interruption Loans Scheme (CBILS) on 27 April 2020. </li>
<li class="xparagraph">
The British Business Bank (BBB) approved five more lenders for accreditation under the CBIL scheme last week, bringing the total number of accredited lenders to 68. The BBB also approved two new lenders for accreditation under the Bounce Back Loan Scheme (BBLS), bringing the number of accredited lenders to 17. All lenders accredited under the CBIL scheme have been invited to join the BBL Scheme.</li>
<li class="xparagraph">
More information on the CBIL scheme is available <a href="https://www.ukfinance.org.uk/coronavirus-business-interruption-loan-sch…;. More information on the BBL scheme is available <a href="https://www.ukfinance.org.uk/bounce-back-loan-scheme">here</a&gt;. More information on the CLBILS scheme is available <a href="https://www.ukfinance.org.uk/coronavirus-large-business-interruption-lo…;. </li>
The government?s ?<a href="https://www.gov.uk/government/news/government-launches-new-coronavirus-… finder</a>? tool can help businesses and self-employed people across the UK to quickly and easily determine what financial support is available to them during the coronavirus pandemic. </li>