As coronavirus continues to shutter business both large and small, the financial implications of the pandemic are becoming clear: this isn’t going to be easy for anyone.
Thankfully, Boris Johnson's second daily press conference of the outbreak focused around chancellor Rishi Sunak's announcement of a stimulus package designed to protect businesses impacted by Covid-19; the financial implications of the conference will be far reaching.
Among the announcements was that of a new temporary Coronavirus Business Interruption Loan Scheme.
It aims to support businesses to access bank lending and overdrafts. Here's how it all works:
How does the Coronavirus Business Interruption Loan Scheme work?
Speaking at the daily briefing, Mr Sunak said: “The coronavirus pandemic is a public health emergency. But it is also an economic emergency.
He added: “Any business who needs access to cash to pay their rent, the salaries, suppliers, or purchase stock, will be able to access a government-backed loan, on attractive terms.
“And if demand is greater than the initial £330 billion I’m making available today, I will go further and provide as much capacity as required. I said whatever it takes – and I meant it.
“That support will be delivered through two main schemes: to support liquidity amongst larger firms, I have today agreed a new lending facility with the Governor of the Bank of England to provide low cost, easily accessible commercial paper.
“To support lending to small and medium-sized businesses, I am extending the new Business Interruption Loan Scheme I announced at the Budget last week, so that rather than loans of £1.2 million, it will now provide loans of up to £5 million, with no interest due for the first six months.”
The government will provide lenders with a guarantee of 80 per cent on each loan (subject to a per-lender cap on claims) to give lenders further confidence in continuing to provide finance to small and medium-seized enterprises (SMEs).
The government will not charge businesses or banks for this guarantee, and the Scheme will support loans of up to £5 million in value.
Businesses can access the first six months of that finance interest free, as government will cover the first six months of interest payments.
Is my business eligible?
To be eligible for the scheme, your business must:
- Be UK based in its business activity with annual turnover of no more than £45m
- Have a borrowing proposal which, were it not for the COVID-19 pandemic, would be considered viable by the lender, and for which the lender believes the provision of finance will enable your business to trade out of any short-to-medium term difficulty
- If the lender can offer finance on normal commercial terms without the need to make use of the scheme, they will do so.
When is the scheme live?
The scheme went live on Monday 23 March and will initially run for six months.
How do I apply?
The British Business Bank (BBB) says, "any small business interested in CBILS should, in the first instance, approach one of the 40+ accredited lenders with their borrowing proposal.
"If the CBILS lender can offer finance on normal commercial terms without the need to make use of CBILS, they will do so.
"Where the small business has a sound borrowing proposal but no, or inadequate security, the lender will consider the small business for support via CBILS."
What other help is available?
Other measures are in place to try to protect small business in this most uncertain of times, including support for businesses who are paying sick pay to employees, and businesses that pay business rates.
For more information, head to the government's website
Coronavirus: the facts
What is coronavirus?
COVID-19 is a respiratory illness that can affect lungs and airways. It is caused by a virus called coronavirus.
What caused coronavirus?
The outbreak started in Wuhan in China in December 2019 and it is thought that the virus, like others of its kind, has come from animals.
How is it spread?
As this is such a new illness, experts still aren’t sure how it is spread.
But, similar viruses are spread in cough droplets.
Therefore, covering your nose and mouth when sneezing and coughing, and disposing of used tissues straight away is advised.
Viruses like coronavirus cannot live outside the body for very long.
What are the symptoms?
The NHS states that the symptoms are: a dry cough, high temperature and shortness of breath - but these symptoms do not necessarily mean you have the illness.
Look out for flu-like symptoms, such as aches and pains, nasal congestion, runny nose and a sore throat.
It’s important to remember that some people may become infected but won’t develop any symptoms or feel unwell.
What precautions can be taken?
Washing your hands with soap and water thoroughly.
The NHS also advises to cover your mouth and nose with a tissue or your sleeve (not your hands) when you cough or sneeze; put used tissues in the bin immediately and try to avoid close contact with people who are unwell.
Also avoiding touching eyes, nose and mouth unless your hands are clean.
As of Monday 16 March the government advised that everyone should be observing social distancing - avoiding unnecessary travel and working from home where possible.
Anyone with a cough or cold symptoms now needs to self-isolate with their entire household for 14 days.
The government has now instructed bars, restaurants and theatres to close and will review on a ‘month to month’ basis.
Schools closed from Friday 20 March for the foreseeable future, and exams have been cancelled.
The over 70s or anyone who is vulnerable or living with an underlying illness are being asked to be extra careful and stay at home to self-isolate.
People with serious underlying health conditions will be contacted and strongly advised to undertake "shielding" for 12 weeks.
For more information on government advice, please check their website.
Should I avoid public places?
The advice now is to avoid public places and any non-essential travel.
Travel abroad is also being advised against for the next 30 days at least, and many European countries have closed their borders.
What should I do if I feel unwell?
Don’t go to your GP but instead look online at the coronavirus service that can tell you if you need medical help and what to do next.
Sources: World Health Organisation and NHS