Martin FullardThe government has extended the size of loans available to larger businesses which have been affected by the Covid-19 pandemic.
The Treasury has said companies will now be able to receive up to £200m from the Coronavirus Large Business Interruption Loan Scheme (CLBILS), which previously had a maximum pay-out of £50m.
It said that loans under the expanded scheme will be made available to firms from 26 May.
The CLBILS scheme was introduced last month by chancellor of the exchequer Rishi Sunak to support companies with sales of between £45m and £250m.
It was introduced for firms who are ineligible for the Coronavirus Business Interruption Loan Scheme (CBILS) intended for smaller firms, and the Bank of England’s Covid Corporate Financing Facility (CCFF), which has been accessed by very large firms, such as easyJet.
The government said it has handed out £359m through the CLBILS scheme, while it has provided 36,000 loans worth more than £6bn through the CBILS scheme.
Economic secretary to the Treasury John Glen said the government was determined to support businesses of all sizes throughout the crisis. He said: “Our loans and guarantees have already provided over £32bn to thousands of firms.
“We’re increasing the maximum loan to £200m to make sure companies get the help they need.”
Suren Thiru, head of economics at the British Chamber of Commerce, noted it was a positive move, saying: “It is good to see the government continue to listen to business concerns and make improvements to existing schemes.
“These important changes could make a real difference to larger firms in particular and, alongside the other lending support schemes, will help ensure that more businesses of all sizes get access to the finance they need to help weather this unprecedented economic storm.”
Companies borrowing more than £50m through CLBILS will be subject to restrictions on dividend payments, senior pay and share buy-backs during the period of the loan, the Treasury added.