UK Business Survey Finds Firms Struggling to Access Emergency Cash | Business
More companies in the UK are laying off staff as they start to run out of money and struggle to access emergency government coronavirus financial support, a leading employers’ organization said .
The British Chamber of Commerce (BCC) said its weekly survey of how businesses were dealing with the Covid-19 The crisis has seen an increase in the number of people planning to lay off workers following the economic lockdown.
The employers’ organization said only 1% of companies responding to its survey had obtained a loan under the government program Coronavirus Business Interruption Loan Scheme (CBILS) when 7% had received one of the grants offered by the Treasury for small businesses.
The survey found little change in the severe cash flow challenges many businesses face, with 57% of businesses having three months or less of reserve, and 6% saying they were already running out of cash. money.
Companies responded to the survey between April 1 and April 3, during which time the Chancellor, Rishi Sunak, relaxed the criteria for a CBILS loan, banned banks from asking for personal guarantees from small businesses seeking help, and made more midsize businesses eligible for aid.
The BCC said the changes were needed as 37% of those polled said they plan to put between 75% and 100% of their workforce on leave over the next week, up from 32% last week. The proportion planning to put 100% of their workforce on leave has increased from 17% to 20%.
Adam Marshall, CEO of the BCC, said: “Our latest data shows that many companies are facing a cliff-edge scenario, either at the end of this month or in the next quarter.
“We have seen a sharp increase in the number of companies putting staff on leave, and many are now starting to seek access to government loan and grant programs to keep themselves afloat. Yet our research suggests that support is only beginning to reach the companies on the ground.
“We are happy that the Chancellor is listening and responding to our calls to strengthen the existing support. Improvements to the CBILS program are expected to help more businesses access the cash they need over the coming days and weeks. This could mean the difference between survival and insolvency for many businesses. “
Marshall added, “Every minute counts, and governments, local authorities and banks need to do everything in their power to ensure that support gets to the front-line businesses faster. “