Construction and retail sectors take lion’s share of government-backed loans
Businesses in the construction and retail sector have received the highest portion of funding through government-backed loan schemes since the start of the Covid-19 crisis, new data has shown.
According to the British Business Bank, construction companies have received 17 per cent of all funding under the bounce back loan (BBL) scheme, and 14 per cent of the loans distributed via the coronavirus business interruption loan scheme (CBILS).
The wholesale and retail sector has claimed a 16 per cent share of BBLs and a 19 per cent share of CBILS. Manufacturing firms received 13 per cent of CBILS loan distributions and six per cent of bounce back loans.
Meanwhile financial and insurance activities made up just one per cent of all CBILS loans and one per cent of BBLs.
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“Throughout this crisis, we have backed business of all sizes in in every corner of the UK,” said small business minister Paul Scully.
“The schemes put in place by the government-owned British Business Bank have provided some much-needed breathing space for businesses as they deal with the challenges posed by coronavirus.
“Government support has helped firms right across Britain, not just in keeping businesses going but now enabling thousands to bounce back in a safe, Covid-secure manner.”
The British Business Bank data also found that businesses in London and the south east received the highest proportion of both CBILS (33 per cent) and BBLs (34 per cent).
The East of England received 11 per cent of CBILS loans – the highest proportion outside of London and the South East. Meanwhile, the north west of the country received the highest proportion of BBLs outside of the capital, taking an 11 per cent share of all distributions to date.
“A key objective for the British Business Bank is to identify and help reduce regional imbalances in access to finance for smaller businesses across the UK,” said Keith Morgan, chief executive officer of the British Business Bank.
“It is welcome to see in the data that these schemes are helping businesses across the UK’s three devolved nations and nine English regions to access the finance they need to survive and stabilise, putting them in a better position to grow as we move into recovery.”
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Stephen Pegge, managing director of commercial finance at UK Finance, added: “Lenders understand that times are tough for businesses up and down the country, but the industry has a clear plan to help them get through this crisis.
“Whether you’re a sole trader in a rural area or a company with hundreds of employees in a major city, the banking and finance industry stands ready to offer the right support to suit your needs and these figures demonstrate that funding is well distributed throughout the UK.
“Businesses should remember that any lending provided under government-backed schemes is a loan not a grant, and so should carefully consider their ability to repay before applying.”
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