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Nearly 800,000 small firms approved for Bounce Back Loans with car dealers using them to buy stock

Time 1 year ago

A staggering 782,246 small businesses have successfully applied for the government’s Bounce Back Loans – equivalent to nearly £24bn in funding.

The loans, 100 per cent back by the government, have enabled small businesses to borrow up to £50,000 each to ease cash flow.

They are interest free and no repayments need to be made for a year, with 2.5 per cent interest thereafter.

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In the latest figures released today (June 9) by the government it was revealed 782,246 small businesses have successfully received funding under the Bounce Back Loan scheme, out of a total of 964,414 applications.

The figure has risen £2.49bn in a week as more small businesses apply for the funding.

Many car dealers have borrowed cash under the Bounce Back Loan scheme and are now using it to fund stock purchases, such is the low rate of interest that it betters other funding they had in place.

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Shoreham Vehicle Auctions managing director Alex Wright said: ‘The loan has given used car and van dealers a cashflow boost.

‘The government low interest loan has provided a lifeline for many dealers. 90 per cent of those dealers we spoke to have all confirmed it has helped stimulate their businesses, which has in turn given the used market a leg up as it comes out of lockdown.’

The government figures released today also show the Coronavirus Business Interruption Loan Scheme has now lent £9.56bn to 47,650 businesses – but nearly half of the applications have been turned down, with 45,655 failing in their bid to secure cash.

The larger Coronavirus Large Business Interruption Loan Scheme has now lent £1.7bn to 244 business. However, 371 firms have been turned down for the loans as of June 7.

Meanwhile, British businesses have furloughed nearly nine million jobs, under a scheme where the Government pays up to 80% of an employee’s salary while they stay at home.

Small firms hoping for second round of £10k grants will now have to apply to councils

James Baggott's avatar

James is the founder and editor-in-chief of Car Dealer Magazine, and CEO of parent company Baize Group. James has been a motoring journalist for more than 20 years writing about cars and the car industry.

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