Posts Tagged ‘CBILS’

CBILS & Bounce Back Loan Extension; Loan Support Figures; and Unintended Consequences

Posted on: September 28th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , ,
Posted in Business Finance Bulletin

This episode is devoted to developments within the CBILS and Bounce Back Loan government support schemes. Given the ongoing economic problems, we kick off with a look at the Chancellor’s announcement that the CBILS and Bounce Back Loan application deadlines have been extended. Is it time to re-look at your borrowing requirements?

We look at the latest figures from HM Treasury on how much has been borrowed from the two main support schemes. The amount of money borrowed is a significant sum and signals a tough 2021 for many businesses when it comes to repaying these loans.

To close this Bulletin, we consider some of the unintended consequences of the CBILS and Bounce Back Loan schemes in term of future availability of finance and capacity for businesses to borrow.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · CBILS & Bounce Back Loan Extension; Loan Support Figures; and Unintended Consequences

HMRC Creditor Status in Insolvencies; Calls to Extend Wrongful Trading Moratorium; CBILS & Bounce Back Loan Update

Posted on: July 27th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , ,
Posted in Business Finance Bulletin

On 22nd July HMRC’s status as a Preferential Creditor in insolvency situations was restored after nearly 20 years. Could this have an impact on the cost of obtaining business finance and the appetite of lenders to support businesses?

As growth in the economy begins to kick back in, many businesses are a long way off in settling into a new routine. To take the pressure off, calls are being made for the government to extend the temporary moratorium on Wrongful Trading which is due to be lifted at the end of September.

To close this Bulletin, we review the latest CBILS and Bounce Back Loan figures which continue to provide a financial lifeline to businesses.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · HMRC Creditor Status; Calls to Extend Wrongful Trading Moratorium; CBILS & Bounce Back Loan Update

You can also read the transcript of this Bulletin below…

Changes to HMRCs ‘s creditor position in an insolvency; calls to extend the deadlines on the government support schemes; and I look at the latest CBIL’s and Bounce Back loan figures. All of this in the latest Business Finance Bulletin.

Let’s start this Bulletin by having a look at the little known change came into effect on the 22nd of July, which could have an impact on the cost of unsecured business borrowing. 
So what was that change? 
Well, on the 22nd of July, the Finance Bill passed through Royal Assent. In that Finance Bill was a change to HMRC ‘s creditor position as regards where it ranks when payments are due to it under an insolvency situation.
We need to wind this back to before 2002.

Before 2002, HMRC had a preferential creditor status. If a company went into insolvency, HMRC in respect of PAYE, VAT and National Insurance contributions, would have a first call on funds ahead of other unsecured creditors. However, via the Enterprise Act of 2002, their position was downgraded and they sat alongside other unsecured creditors. So money was shared out equally. 
The government, obviously is looking to increase his tax take. In 2018, it decided to reverse this position, making HMRC again, a preferential creditor. What kind of impact is this having in terms of business borrowing? 
Now we’ve got the position where, as before, HMRC can now take first call in respect of VAT PAYE and National Insurance.

That means essentially there’s less money now to share out amongst the unsecured creditors. So that’s going to put them in a worse position. From a business banking point of view, that’s obviously is going to be a concern. 
If you’ve got a Debenture which captures stock and other assets, now there’s less money to go around to secure and satisfy that Debenture. The impact’s going to be that it’s going to make borrowing potentially more expensive or take away and dampen further the amount of appetite that banks have to lend to businesses. 
So it’ s a little known change, but it potentially could end up costing you a bit more money when it comes to borrowing on an unsecured basis,

As businesses start to open their doors again and get back to a semblance of normal trading, t here are calls now being made for the government to extend certain elements of the support that they provided businesses over the last couple of months. Now, one area that is being called for an extension is a change that was made via the Corporate Insolvency and Governance Act early this year. 
Under this Act, the concept of Wrongful Trading has been temporarily put aside. What I mean by this and I’ve covered this in previous Bulletins, Wrongful Trading is where as a Director, if you knowingly enter into a credit agreement, when, your business is insolvent, you could actually be accused of Wrongful Trading.
The government thought that this isn’t right during these turbulent times, and so they put a temporary moratorium on that to allow directors to take really good decisions in these uncertain times, mindful of the fact that they would not then be prosecuted for Wrongful Trading.

That moratorium finishes on the 30th of September. RSM, a auditing and accounting and consultancy firm have written to the Chancellor last week, pleading to extend that moratorium to the end of December this year, to give another period for businesses to settle down while they reassess their model and look at how they can do business and look ahead as to what their borrowing requirements are going to be; they think it’s unfair that that 30th of September deadline is met. 
There are also calls at the same time for the government to further extend the CBILs scheme as well. We’ll look later on in this Bulletin, but there’s still lots of applications coming through. 
As we start to get back into a new normal, calls are now being made for the government to extend deadlines and provide further support to businesses.
Continue watching this Bulletin and I’ll bring you updates as and when they come out.

To close this Bulletin , let’s take a look at what’s going on with the Bounce Back Loan scheme and the CBILs scheme. Figures have been released by HM Treasury and the British Business Bank as at 19th of July and their figures reveal that a total of £48 billion has now been lent out by accredited lenders.
That’s £48 billion of new money that’s been pumped into the economy in order to support struggling businesses.
Let’s have a look at the numbers underlying those figures. First of all, let’s look at the Bounce Back Loans. In terms of loans distributed of Bounce Back’s, there are now 1,084,153 loans; £32.79 billion has been lent out and it’s got an approval rate of 82%. So a very strong success rate.

Turning now to CBILs , which starts kicking in at £50,001 and above, not as good a numbers as Bounce Back Loans, but still really strong. Total number of CBILs loans now stand at 55,674; £12.2 billion has been lent out and it’s got an approval rate of 50%.

So not as good as a Bounce back Loan. There’s more due diligence and assessment goes into a CBILs facility, hence that success rate not being as good as under the Bounce Back Loan scheme. I’ve mentioned in previous Bulletins, you’ve got to be really aware if you’ve taken out any of these facilities in 2021, obviously your repayments will kick in.

If you’re looking to borrow money going forward under ordinary loan schemes, the banks are going to be critically looking at this new liability that will kick in in quarter one and quarter two next year; they’re going to factor those new repayments into your cashflow. Also you’ve got to be mindful as well, i f you’ve taken out a Bounce Back Loan or CBILs, then you’re kind of sending a signal that your business is not as strong and that you needed it.

Now I know many businesses that just applied for the loan because it’s such a good interest rate and why wouldn’t you. And certainly it’s there to use to help grow your business. But if you don’t need it, I would critically take a look say month 10 before your repayments kick in as to whether you actually still need it. I f you want to have a clean balance sheet are not impact on your ability to borrow money in the future. Think about paying it back. There are of course no penalties to paying it back early. So the schemes continue to be popular if you haven’t applied and you do need it, g et in there quick, all of these schemes have a finite deadline.

That’s it for another Bulletin and as ever, I hope you enjoyed watching. I f you did, please, don’t forget to give it a like and a share and subscribe to this channel. So that’s it. I look forward to being with you next time. In the meantime, have a safe, profitable, healthy week.

CBILS and Bounce Back Loan Repayments; Business Confidence Levels; Help for Refused CBILS Applicants

Posted on: July 20th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

Opening the latest Business Finance Bulletin, we look at proposals presented by financial firms and professionals on how to ease the debt and cashflow burden facing business in 2021 when CBILS and Bounce Back Loan repayments start.

As businesses open and consumers slowing start spending, we review the latest quarterly survey from Hitachi Capital Business Finance which reveals that business confidence is slowly beginning to return, especially among small businesses.

To close, the announcement that the European Union has relaxed the Undertaking in Difficulty test means that businesses refused a CBILS loan due to an insolvent Balance Sheet can now re-apply. This is good news for businesses previously denied access to the CBILS programme.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · CBILS and Bounce Back Loan Repayments; Business Confidence Levels; Help for Refused CBILS Applicants

Bounce Back Loan and CBILS Milestone; Business Confidence and Late Payment Pressures

Posted on: July 6th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

Opening our latest Bulletin, we look at a milestone hit by the government guarantee loan support schemes – the Bounce Back Loans and CBILS. The number of loans disbursed have hit record highs and proved to be a lifeline for many businesses and another batch of lenders added to the panel further improve access to the various schemes.

Studies are now exposing the extent of the impact of recent events on business performance and profitability but there is a glimmer of light. We look at surveys from Lloyds Bank, Xero and the Federation of Small Businesses which reveal the pressures businesses are under.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · Bounce Back Loan and CBILS Milestone; Business Confidence and Late Payment Pressures

Insolvency Law Changes; Cashflow Challenges Facing Businesses; and Bounce Back Loan Fraud

Posted on: June 29th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

We open the latest Business Finance Bulletin with a look at changes to insolvency law with the passing of the Corporate Insolvency and Governance Act. How will this help struggling businesses?

As businesses get back into the swing of trading, what are the challenges facing them? A survey from MarketFinance reveals how businesses are faced with tackling long overdue invoices and the future impact on cashflow.

To close this Bulletin, with Bounce Back Loans proving to be a lifeline for cash-strapped businesses, it appears that some Directors are misusing the funds, leaving them open to close scrutiny in the event of business failure.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · Insolvency Law Changes; Cashflow Challenges Facing Businesses; and Bounce Back Loan Fraud

What’s Ahead for Small Businesses, New Lenders and Updates on Bounce Back Loans and CBILS

Posted on: June 22nd, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

Starting this week’s Bulletin, with businesses either back trading or gearing up to open the doors, we look at surveys from Aldermore Bank and UK Finance which reveal how businesses see the next 12 months in terms of borrowing and growth.

The British Business Bank announces accreditation of more new lenders on the Bounce Back and CBILS loan schemes. Are we at the stage where there are enough on the panel of lenders?

To close, we review the latest figures on the two loan schemes and consider why the number of unsuccessful CBILS applications remains stubbornly high.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · What’s Ahead for Small Businesses, New Lenders and Updates on Bounce Back Loans and CBILS

Planning Ahead for Recovery; Trade Credit Insurance; and Bounce Back and CBILS Loan Update

Posted on: June 8th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

In this week’s Business Finance Bulletin, we open the episode by considering what type of economic recovery you should be planning for. Which scenario best fits your plans?

The ability of businesses to confidently trade among themselves is key to re-building the economy. We look at a new scheme launched by the government to ensure the continuance of Trade Credit Insurance.

To close, we take our regular look at the numbers behind the Bounce Back Loans and the Coronavirus Business Interruption Loan Scheme.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · Planning Ahead for Recovery; Trade Credit Insurance; and Bounce Back and CBILS Loan Update

Using your CBILS and Bounce Back Cash; Business Confidence; and Latest Support Loan Figures

Posted on: June 1st, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , ,
Posted in Business Finance Bulletin

Kicking off the latest Business Finance Bulletin, with businesses now in receipt of CBILS and Bounce Back Loans, what can you do with the cash? We look at one use you should think very carefully about before pushing the button.

Naturally, business confidence has taken a hit over the last few months. I discuss how confidence levels are faring and review a survey from Aldermore Bank on the impact on business income since the lockdown.

To close, our regular look at the CBILS and Bounce Back Loan statistics. How many businesses have taken advantage of this government support scheme?

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Google, Spotify, Stitcher or itunes channel.

Business Finance Bulletin · Using your CBILS and Bounce Back Cash; Business Confidence; and Latest Support Loan Figures

Bounce Back Loans and CBILS Update, Business Pressures and Trade Credit Insurance – BFB 299

Posted on: May 18th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , , , , ,
Posted in Business Finance Bulletin

Kick starting the latest Business Finance Bulletin we take our regular look at Bounce Back loans and CBILS progress. The Bounce Back loans have proved to be popular, but some concerns remain among businesses still struggling to access the Scheme.

Aldermore Bank have surveyed businesses to understand the impact the lockdown has had on business sales. However, the survey reveals that businesses have taken bold and swift steps to safeguard their future.

Closing the Bulletin, looking ahead to post-lockdown the government has pledged support to the Trade Credit Insurance sector. The support package will ensure firms can confidently continue offering credit terms.

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Spotify, Stitcher or itunes channel.

CBILS Progress Update, Bounce Back Loans Launched and Business Changes – BFB 298

Posted on: May 11th, 2020 by blsuser1 No Comments Tags: , , , , , , , , , , ,
Posted in Business Finance Bulletin

Opening this week’s Bulletin, we take our regular look at how the Coronavirus Business Interruption Loan Scheme is performing and how the approval rate is on the rise.

The Bounce Back Loan Scheme has been launched and we look at how some banks have been better than others in terms of their processes.

Wrapping up the Bulletin, with firms now planning ahead what changes are they planning to make to the way they do business?

If you would prefer to listen to the podcast version you can click below or download to listen to later via our Soundcloud, Spotify, Stitcher or itunes channel.

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