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How many businesses will default on their coronavirus emergency funding?

L

lookingforadvice

New Member
Verified Member
The UK government has guaranteed literally billions of pounds in coronavirus emergency funding for businesses. Indeed there is a new scheme coming out on 4 May which will see the government guarantee loans for small businesses. How many businesses do you think will default on their coronavirus emergency funding leaving the government to foot the bill?
 
E

Employer

Member
Verified Member
Interesting question and will the government cover all of the inevitable loses incurred by the banks? If you remember there was a little bit in the scheme fine print suggesting loans should only be made if the business was viable as at 31 Dec 2019.
 
L

lookingforadvice

New Member
Verified Member
I know of a friend who was refused one of the financial support packages because they were behind with their business rates so it is happening. I am not so sure the bounce back loan scheme is as limited - what I am hearing is that it may not even depend upon a persons/business credit rating. Who would pay back the loan if the business was to fold?
 
E

Employer

Member
Verified Member
That’s a tricky one, if the business is not viable then does it make sense to throw taxpayers money into the pot? Then again, without a boost from taxpayer funded bailout packages the company is dead and buried and one more person on the unemployed list.
 
Needhelp

Needhelp

Active Member
Verified Member
The longer this goes on the more chance of some companies struggling to get going again. Cashflow will be a huge issue when we return to any degree of "normality" and there could be some pain ahead for employees.
 
G

Goingitalone

Member
Verified Member
If you take a step back and think about it, whether the coronavirus bailout funding is used to keep a business afloat, pay off creditors or spend on the economy, surely that is the whole purpose?
 
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