LONDON- Some small lenders issuing loans on behalf of Britain’s Coronavirus Business Interruption Loan Scheme (CBILS) risk running out of taxpayer-backed cash to lend before a Sept. 30 deadline for applications, three sources told Reuters.
The British Business Bank (BBB), which oversees CBILS and provides accreditation to participating lenders, has declined to top up allocations to some small lenders as the scheme draws to an end, said the sources, who declined to be named because the matter was commercially sensitive.
Some of these lenders were hoping to lend more than their original allocation in the final weeks of the demand-led, no-capacity scheme and were relying on top-ups to issue timely loans to customers, one of the sources said.
A potential scarcity of loans coupled with a looming deadline have raised fears more companies may struggle to get the funds they need.
A spokesman for the BBB said it treated each lender request for funds on its merits.
“If, occasionally, we have not been able to support an individual lender’s increased allocation (to the level requested) it is for commercial reasons specific to the individual lender,” the spokesman added.
The squeeze in CBILS allocations comes after the BBB said it would allow banks until Nov. 30 to review and approve loan requests received before Sept. 30.