Don’t invest unless you’re prepared to lose all the money you invest. NextFin promotes high - risk investments and you are unlikely to be protected if something goes wrong.
Take 2 minutes to learn more.
New research has found that only 45% of businesses eligible under the scheme have been able to successfully apply for a Bounce Back Loan. According to risk assessment experts protecting.co.uk, the low numbers come as a result of overcomplicated application systems and busy phone lines.
Bounce back loans are a scheme aimed at providing small and medium businesses between £2,000 and up to 25% of their annual earnings, up to a total of £50,000, which is provided by the government.
According to Mark Hall, spokesman for protect.co.uk: “A lot of people have been struggling to get by during this pandemic, and they’re worried that their businesses will collapse due to a lack of trade. These schemes need to be easier to apply for because people’s livelihoods are on the line.
“But that’s not just where the complications end,” says Hall. “There are strict criteria for business owners seeking to apply for these loans, meaning that many applications have been rejected for reasons such as having already applied for other coronavirus loan schemes, or if they began trading after the 1st March 2020.
“We are hearing stories of business owners who aren’t sure if they will even have a business to return to after Covid-19, they’ve burned through all the money they have and have no choice but to shut shop,” says Hall.
The risk assessment company claims to have heard from hundreds of business owners over the last few weeks who have expressed frustration with the application process for bounce back loans.
According to one shop owner: “It’s impossible to get through on the phone, I waited on hold for three hours and nothing – the phone call cut off. I’ve done this every day this week.”
There have been numerous complaints about many leading banks from customers who haven’t been able to get any money, with some saying that they were incorrectly told they had filled in the application details wrongly, or that having two signatories on the business account created a problem.
Amidst the frustration, banks have managed to approve loans for nearly half a million businesses in the UK, totalling over £40 billion pounds.
But for those who have managed to get approval for a bounce-back loan, new reports indicate that nearly half of businesses have no intention of repaying the money, as they expect they won’t be able to afford the repayments or that their businesses might collapse.
CEO of Nextfin, Sacha Bright, said: “Our research shows that the government partially owned bank RBS/Natwest, is approving the most Bounce Back Loans. However, there are still many businesses that do not qualify for support.
Authors: Oliver Murphy & Sacha Bright
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: sme coronavirus news alternative finance
Alternative Finance: The Four Types Of Crowdfunding
What is Business Interruption Insurance?
The pros and cons to alternative investment in to private companies via debt or equity
Need Recognition? Here Is A List of Competitions And Awards
What Is The Term Funding Scheme, And Why Is It So Important To Extend It To P2P Lenders?
Alternative Finance: The Four Types Of Crowdfunding
The pros and cons to alternative investment in to private companies via debt or equity
What is Business Interruption Insurance?
Should I Invest in P2P?
Self-Employed to Benefit From Second Stage of Support Scheme
How To Start A Business Post-Covid-19
Business Banking Resolution Service To Open In November
Over 1.2m Businesses Have Benefited From Coronavirus Lending Schemes
What is The Start Up Loan Scheme?
Figures Show 730,000 Job Losses Since Start of Lockdown
As seen in: