"SMEs are the backbone of our economy, and we hope these measures will provide British businesses with the support they need at this challenging time."
Chancellor Rishi Sunak has outlined new Covid-19 support plans for small and medium sized businesses.
Sunak announced a new 'Pay as you Grow' scheme for businesses which have taken out government-backed Covid-19 loans. Under the scheme, loans can now be extended from six to ten years nearly halving the average monthly repayment.
Businesses can also move to interest-only payments or suspend payments if they are "in real trouble" for up to six months, with no effect on their credit rating.
Coronavirus Business Interruption Loans will also be extended for up to 10 years and the self-employment scheme has been extended on "similar terms" to the existing job support scheme.
Businesses who have deferred their VAT will no longer have to pay a lump sum at the end of March next year and can instead split it into smaller, interest-free payments over the course of 11 months.
Additionally, the Government has extended the 15% VAT cut for the tourism and hospitality sectors to the end of March next year.
Chirag Shah, CEO of Nucleus Commercial Finance, commented: “As fears of a second wave become reality, businesses across the country are fighting for survival. As such, today’s announcement of an extension to both the Bounce Back Loan Scheme and Coronavirus Business Interruption Loan Scheme is welcome news for business owners throughout the country, who are looking for access to fast and flexible finance now, more than ever before.
“SMEs are the backbone of our economy, and we hope these measures will provide British businesses with the support they need at this challenging time. But while this announcement provides immediate relief to small businesses, the Chancellor must also deliver long-term plans to ensure they can not only survive the Coronavirus crisis, but thrive for years to come: this is where the alternative finance industry has a vital role to play.”