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Author: Sacha Bright & Oliver Murphy
The British Business Bank has approved four new lenders for accreditation under the Coronavirus Business Interruption Loan Scheme (CBILS).
The lenders include ThinCats, Paragon Bank, Independent Growth Finance and Allied Irish Bank. Still, even today, only 1 P2P platform has been approved to offer loans under CBILS: Funding Circle.
Following their approval, each lender will be putting in place the operations required to start lending under the scheme and will confirm shortly the dates from which they will be ready to start receiving CBILS applications from smaller businesses across the UK.
Business Secretary Alok Sharma said: “These loans are an essential part of the wide-ranging package of support the government has put in place to help UK businesses. I am delighted to see more lenders offering loans which will, in turn, help even more businesses access the funds they need.”
Yet, the news comes as peer-to-peer lenders call for further improvements to the loan scheme, as it emerged last week that just 6,020 applications have been approved.
According to Nicola Horlick, chief executive of Money&Co: “The British Business Bank really needs to get their act together and start making the scheme more dynamic, ensuring the money gets to these companies as fast as possible,” said Nicola Horlick, chief executive of Money&Co.
The government needs to be faster approving lenders like us, we’re very keen to help, as are other platforms I imagine. We talk to small businesses and can act much faster than banks.”
NextFin, the alternative finance comparison site which represents all platforms, is aware of dozens of P2P lenders that are applying to the British Business Bank to deploy these loans.
In a letter seen by NextFin, Conservative MP Kevin Hollinrake, co-chair of the All Parliamentary Group on Fair Business Banking, called for the British Business Bank to add non-major bank lenders to the loan scheme and labelled the initial launch a “major disappointment''.
Responding to the news, CEO of NextFin, Sacha Bright, said: “The economic landscape is changing rapidly. As a result, it’s essential small businesses have access to fast and flexible funding built around their needs.
P2P platforms are the answer to this. The reason why the P2P market has expanded so quickly over the last 8 years is because platforms are fast and efficient in their lending processes, utilising the latest financial technology.
With this in mind, surely, the best way to get money to small businesses quickly is to extend the CBI Loan to P2P lending sites? Under the scheme, the government could provide P2P lenders with a guarantee of 100% on each loan to give investors further confidence to invest through P2P platforms to continue to lend to SMEs.”
Disclaimer
To the best of our knowledge, the information we have provided is correct at the time of publishing. Sacha Bright is not a solicitor or accountant and we recommend that you seek professional advice on any topic discussed.
Tagged: News CBILS P2P lending Money & Co
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