The UK will address the existing financial gap for startups in the country on the back of the Covid-19 pandemic. Last month, the UK government launched a £330 billion loan scheme for those startups affected by the pandemic.
The UK’s attempts to bridge the financial gap for startups will help to survive the impact of the economic hit as a result of the pandemic. It is reported that many businesses are at a risk of collapse. According to the Corporate Finance Network of accountants, nearly 18 percent of small and medium size businesses are at such a risk.
Under the scheme, businesses with an annual turnover of £45 million and £500 million are eligible for loan applications up to £25 million from banks with an 80 percent government guarantee, media reports said.
The UK government is in frequent contact with the tech industry. For larger medium sized businesses, the new scheme will be offered at commercial rates of interest, media reports said.
Adam Marshall, director general of the British Chambers of Commerce, told the media, “Improvements to the Coronavirus Business Interruption Loan scheme will help firms get access to cash more quickly, and the announcement of a new loan scheme for mid-sized companies closes a significant gap in existing support.”
The UK government might ease the criteria for loans for small businesses seeking to access loans from the current scheme. This means those businesses unable to secure commercial financing will now become eligible.