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Business Interuption Loans

Discussion in 'General Business Forum' started by Sarah Dinnage, Mar 24, 2020.

  1. Sarah Dinnage

    Sarah Dinnage UKBF Newcomer Free Member

    10 3
    How are you all getting on with this? My progress so far seems completely rubbish...

    Rang bank 5 days ago about putting a couple of payments on hold and the nice HSBC lady said she was simply taking details and someone would call back in the next few days.

    On the other hand I keep getting alerts from HMRC saying the scheme is live.

    There is a small paragraph on the HSBC website but no where to apply, unless you call...which I had already done..

    Anyone actually got anywhere....
     
    Posted: Mar 24, 2020 By: Sarah Dinnage Member since: Dec 12, 2017
    #1
  2. The Soup Dragon

    The Soup Dragon UKBF Regular Free Member

    101 2
    No also HSBC and cant see any apply mechanism except phone for a chat
     
    Posted: Mar 24, 2020 By: The Soup Dragon Member since: May 13, 2013
    #2
  3. SCRMedia

    SCRMedia UKBF Newcomer Free Member

    6 0
    We bank with Barclays and I got an email earlier today to say they are now live with them
     
    Posted: Mar 24, 2020 By: SCRMedia Member since: Jan 29, 2019
    #3
  4. JEREMY HAWKE

    JEREMY HAWKE UKBF Legend Full Member

    4,593 1,482
    It looks like some banks are profiting from this by adding high interest rates onto the deal
    Worse than that some brokers are advising in some cases that the director has to put up personal security in the form of a property charge .
    It was clearly stated that the loans could only be secured on the company assets
     
    Posted: Mar 26, 2020 at 8:54 AM By: JEREMY HAWKE Member since: Mar 4, 2008
    #4
  5. Mr D

    Mr D UKBF Legend Free Member

    20,577 2,373
    Banks try and make money from desperate people?
    Make note so can avoid using those in the future.
     
    Posted: Mar 26, 2020 at 8:56 AM By: Mr D Member since: Feb 12, 2017
    #5
  6. Gordon - Commercial Finance

    Gordon - Commercial Finance UKBF Ace Free Member

    2,097 635
    I’ve not seen any at unusual rates. What needs to be remembered is that this is generally going to be an unsecured loan. The rates on unsecured are higher than if they were secured on a business asset.
     
    Posted: Mar 26, 2020 at 9:49 AM By: Gordon - Commercial Finance Member since: Jun 26, 2017
    #6
  7. Barney2201

    Barney2201 UKBF Contributor Free Member

    57 1
    Check out this article

    https://www.bbc.co.uk/news/business-52043896

    As usual the banks want their cake and eat it..

    We are with HSBC, might need to head down this route eventually.

    If anyone has success in getting an application form maybe they could share it with the forum, would be good to see what level of detail is required for each lender.
     
    Posted: Mar 26, 2020 at 10:14 AM By: Barney2201 Member since: Jun 3, 2007
    #7
  8. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,278 1,472
    It’s not often I sympathise with banks but they have been dumped right in it here


    The ‘guarantee’ from the government comes with all sorts of caveats - including that they must prove that they have pursued every possible avenue of recovery (except the home) under PGs

    it’s a given that a lot of applicants have no chance of repaying - the only way banks can recoup that is through charging interest to those who do.

    someone on radio this morning was claiming that 22% interest would bankrupt him - if the interest in a business interruption loan will bankrupt you, I’m afraid you don’t have a business

    I’m fully behind Boris, but loans are t the right vehicle for many applicants.
     
    Posted: Mar 26, 2020 at 10:41 AM By: Mark T Jones Member since: Nov 4, 2015
    #8
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  9. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,278 1,472
    Also, there are some very desperate and very devious brokers out there - and some of the smaller lenders

    I’ve been imploring people via LinkedIn and other channels to avoid borrowing unless they gave a clear route to repay

    sadly many will go with the ‘easiest’ way, which will probably involve a false promise
     
    Posted: Mar 26, 2020 at 11:09 AM By: Mark T Jones Member since: Nov 4, 2015
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  10. Aniela

    Aniela UKBF Newcomer Free Member

    12 0
    It's not really about profiting but risk limitation.

    Lenders are mainly only offering the business interruption loans, if no other suitable options are viable.

    They can't put someone's home under the PG, for the business interruption loan, so that sounds like they've been fed wrong information. It may be that your hearing of people being asked to put a PG up for things offered separately to a business loan.

    Even a 20% or so interest rate isn't that high considering the situation. If a company can't service the 20% interest on a loan, taking into consideration the interest-free period, it would point to an underlying business issue in most cases. AKA the business is likely not viable.
     
    Posted: Mar 28, 2020 at 4:46 PM By: Aniela Member since: Mar 28, 2020
    #10
  11. Porky

    Porky UKBF Newcomer Free Member

    22 9
    I really wouldn’t waste your time with this scheme, it’s absolute [email protected] They should also scrap the previous EFG scheme and stop promoting this so called facility.

    It just amazes me that the muppets in government actually believe they are helping business with this scheme. They should stop wasting our time. Clearly designed by wealthy government officials with no clue whatsoever what it’s like to raise capital for a small business at ground level.

    I was both shocked and disgusted when I read the criteria. Shame on the government promoting this as a possible lifeline for businesses that need cash flow support by way of loan capital during this downturn. It’s a total joke.
     
    Posted: Mar 31, 2020 at 4:12 AM By: Porky Member since: Dec 27, 2019
    #11
  12. JEREMY HAWKE

    JEREMY HAWKE UKBF Legend Full Member

    4,593 1,482
    Risk limitation !
    The government back 80 per cent of loan ! What risk !

    During my studies after they showed me how to write my name then they explained to me that 80 per cent guaranteed on borrowings if the borrower fails to pay means the lender get 80 per cent back
     
    Posted: Mar 31, 2020 at 6:18 AM By: JEREMY HAWKE Member since: Mar 4, 2008
    #12
  13. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,278 1,472
    Teachers live in a very unworldly world!

    what I’m sure your business journey has taught you is that

    1. guarantees always come with conditions
    2. Anything that involves dealing with the government is going to be a PITA to administer
    None of us knows what carrots and sticks are going on behind the scenes but 20% risk on lending that you don’t want to do is unacceptably high - particularly if you then get hounded for charging rates that go some way to covering your losses.

    plus - whatever the circumstances, banks have a duty to lend responsibly - you can guarantee that most applicants will be borrowing in panic - particularly those who complain that it isn’t accessible to them
     
    Posted: Mar 31, 2020 at 8:43 AM By: Mark T Jones Member since: Nov 4, 2015
    #13
  14. JEREMY HAWKE

    JEREMY HAWKE UKBF Legend Full Member

    4,593 1,482
    @Mark T Jones I don't actually trust any these people but they cant tell business one thing and mean something else hence why some people are fuming about this
    If some clown tells his subjects that you will have help people assume they will have help .

    We are probably on our own I am happy with that I have been in the trenches before ! I think that there are people who will lose their business that this week think they still have protection when they don't
     
    Posted: Mar 31, 2020 at 8:55 AM By: JEREMY HAWKE Member since: Mar 4, 2008
    #14
  15. Mark T Jones

    Mark T Jones UKBF Big Shot Free Member

    4,278 1,472
    Yip; I agree that a loan - for many - isn't the right tool for the job - but other than handing out grants, I'm not really sure what is.

    Being honest; A hell of a lot of these businesses have zero resilience and are going to go bust in the recession that will follow this mess.
     
    Posted: Mar 31, 2020 at 9:10 AM By: Mark T Jones Member since: Nov 4, 2015
    #15