A further package of support for the businesses and workers affected by Carillion’s liquidation has been announced
Through delivery partners that include all the major high street lenders, the British Business Bank will provide support to make available up to £100 million of lending to small businesses who may not have the security otherwise needed for conventional bank lending using its Enterprise Finance Guarantee programme.
This will be of benefit to small businesses including the chain of subcontractors to Carillion who may not have sufficient assets as security to access conventional loans. These guarantees can be used to support overdraft borrowing and refinancing of existing debt.
The UK’s leading banks have also furthered their commitment to provide support to those affected with UK Finance confirming additional support for personal banking customers concerned about overdraft, mortgage or credit card repayments, as well as further financial support for small businesses to provide short-term relief to help keep them afloat.
Business Secretary Greg Clark said: “We want to signal very clearly to small and medium sized businesses who were owed money by Carillion that they will be supported to continue trading. The banks have responded to my request by agreeing to support businesses and individuals affected. This further guarantee will help those businesses who may not be able to provide the usual security for a loan. I will continue to work closely with business organisations, trade unions and banks to actively support those affected by Carillion’s insolvency.”
Keith Morgan, British Business Bank CEO, said: “The Enterprise Finance Guarantee (EFG) is an important option for smaller businesses who need access to finance, but may not be able to meet a provider’s normal security requirements. To help in these exceptional circumstances, we have designed additional flexibility into EFG that could be particularly suitable for firms in the Carillion supply chain. We would encourage lenders to work with their customers to use these new flexibilities to meet their needs.”
Stephen Pegge, UK Finance Managing Director, Commercial Finance, said: “UK banks are working with government to support customers and businesses who have been impacted by the Carillion liquidation. The enhancement of the Enterprise Finance Guarantee by the British Business Bank will help those facing temporary cash flow issues to access the finance they need to support their businesses through this period.”
For further information on the British Business Bank click here