Changes to the Coronavirus Business Interruption Loan Scheme will be announced as soon as this week, Sky News learns.
Sources pointed out that users of the programme would still be required to demonstrate that their company was viable going into the crisis, and that they have the ability to repay the loan at the end of the term.
Banks are also understood to have agreed to waive any outstanding demands for personal guarantees on loans up to £250,000 - an issue that has been a source of growing controversy in recent days, despite the fact that it was stipulated in CBILS' terms.Any personal guarantees taken on loans above £250,000 will be used to cover the 20% of the loan that the government is not underwriting, according to one official.
Other aspects of CBILS' structure, including the government guarantee that covers 80% of the lenders' exposure, are likely to remain unchanged.Sources said the Treasury also wanted to see banks publicly agree to a modest 'reversion rate' - a reference to the interest rate to which loans would revert after the initial 12-month period.
Banks and social media have been deluged with complaints from SMEs about the difficulty of getting through to their lenders to discuss CBILS, and the . Banking sources have been at pains to point out that with most bank branch networks closed and absenteeism at unprecedented levels because of the coronavirus outbreak, the industry has been working relentlessly to get the emergency loan scheme off the ground.
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