The loan products that the government has put in place have been great.
I think it’s mentioned on a previous podcast that the CBIL’s got a little bit of stick and rightly so in some respects, but the bounce back loan has been fantastic.
I know and I’ve spoken to lots and lots of people who have really, really benefited from that.
They’ve been able to obviously have up to £50K, which has covered a lot of people off through this testing time.
I think what we’re seeing more of now is “That’s great. We’ve received the £50k, but we are now looking for more”.
We know that on the 4th July 2020, hopefully the hospitality industry will start to open.
From that point of view, obviously those organisations and companies which have been completely down and out because they haven’t been able to transact, are the ones that are going to need a kickstart.
Receiving the £50K, they will have been able to consolidate things over this period and now will need more to get themselves back up and running again.
What will lenders be looking for?
I think they have to be vigilant. That’s only natural.
They’re going to have to understand, it’s not so much that applicants have not been bad business people, it’s obviously something that’s come unexpectedly.
A broker, like us are able to create a proposal and it’s not simply just sending across some documents.
We put together a really strong proposal for every business to be able to say, “Look, this is testing times. This is what has been in place. This was what was going on beforehand. We have a plan for the next four or five months”
What’s the focus now?
The three points that we want to focus on is speedy access to funding, because businesses are going to want to receive funds quickly if they’re up and running, whether that just be for cashflow or simple stock.
Higher levels of funding. So as the months move on and lenders start to get a little bit less vigilant on who they’re looking to lend to, hopefully the amounts will be able to go up with that.
And then just a simple application process, which I think mirrors the speedy access to funding as well. I think those two come hand-in-hand.
Are lenders expecting people to apply for more funds?
People are going to be looking to borrow and it’s not just going to be for the next two or three months. Lenders are aware of that, that this could be up to a year and they’re going to need strong communication with customers and clients to get their businesses back on track.
But on top of that, they will need a kickstart and lenders are really, really happy to have those conversations.
If you looked at this maybe a month ago, I think there’s some industries which would have been a complete no, and we’d have sent applications across and they would have immediately said, “No.” But now, they’re looking outside of that and as long as there’s a strong proposal from the company and from what we can create, fingers crossed, there’s things that we’ll be able to do.
If you’re thinking about applying and you’re on the fence, there really is no harm in doing so and having a conversation with our team on the best way to move forward.
Does it matter what the loan is for?
I think they’re pretty open on what’s being sent across.
Obviously, it would be interesting if companies were coming to us and saying, “Look, we’re looking to expand,” and things like that, obviously with what’s been going on.
But if they are and they’ve got a strong proposal together for it, I’m sure the lenders would be happy to look at it for them.
At the moment, there’s a lot of cash flow interest coming in and also stock.
If people have been closed for the past two to three months, all of their stock will have been outdated, outplaced, and are now looking to rebuild that and use funding to get stuff back in the door and hopefully sold again.
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