ONE MILLION firms are set to shut because they can’t get the government cash they need in the next four weeks.
New research reveals between 800,000 and a million businesses are facing the end due to the coronavirus crisis.
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Firms all over Britain are being either refused emergency loans, or simply unable to get through to banks on the phone.
Those that do are then warned the money will take weeks to arrive.
The new Chancellor Rishi Sunak said two weeks ago that businesses would be able to use Coronavirus Business Interruption loans of up to £5m to help them survive the shutdown.
With most branches closed, thousands of firms are now struggling to get the cash they were promised just a fortnight before.
Engineering group Belgrave & Powell revealed they had struggled to get the funds.
Boss Steve Lord said: “I was heartened and astonished to see the unprecedented help that was announced by the government two weeks ago.
“But we put one of our most senior people on it and as each day passed it was disappointment after disappointment.”
Jewellery company boss Peter Jackson revealed his successful company were refused a loan because it made a loss last year-despite being on course to make a profit in 2020.
He explained: “I thought the whole point of the loans was to help business like mine stay afloat. But they’re not going to help.”
Mark Fuller, who owns popular celebrity haunt Karma Sanctum in Soho explained he could not apply for funds as he was unable to guarantee he could pay it back in six months.
He said: “The loan is under normal business conditions, which is fine but then don’t suggest otherwise.
“I have already been told by the government and Barclays that the only way to receive a loan is by cutting my staff.”
The study has now warned a fifth of all small and medium-sized businesses in the UK are unlikely to get the cash they need in time.
Kirsty McGregor, founder of the Corporate Finance Network, “Small and medium-sized businesses employing less than 250 people employ most of the workforce – 23 million people.
“We could lose up to a million of them in the next month or so. And it will be irreversible which will be catastrophic for the UK economy.”
The figures come from a network of accountants serving more than 12,000 small and medium-sized businesses.
They found 18% of their clients were unlikely to get access to the cash they need to survive a four-week lockdown.
It comes after the banks were accused of trying to take advantage of the situation with massive interest rates and demands to take people’s property if the business goes under.
There are now 25,150 confirmed cases with 1,829 deaths in the UK alone.
It comes as Piers Morgan ripped into ministers for failing to explain WHY Britain can’t test as many people for coronavirus as Germany.
The Good Morning Britain host lost his temper with Robert Jenrick, who couldn’t explain why the UK wasn’t able to get 500,000 tests done like seen in other countries.
The Chancellor’s extra measures announced last month included:
- £350billion in guaranteed loans for businesses – equivalent to 15 per cent of GDP
- Three month mortgage payment holiday for struggling homeowners
- Loans of up to £5million for small businesses – interest free for six months
- Big companies can get low cost Bank of England loans
- Cash grants of up to £25,000 for pubs, restaurants and other hospitality and retail businesses
- A one year holiday from business rates for retailers
- Pubs and restaurants to become takeaways without planning permission
- Businesses insured against pandemics can claim
- Another £3.5billion for Scotland, Wales and Northern Ireland for businesses
- Pledge of more money for the NHS if and when it’s needed
- Work with unions and businesses over sick pay, workers’ rights and welfare benefits
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