Industry News
Industry News 2. FCA extends payment holiday The Financial Conduct Authority (FCA) has told banks and credit providers to extend payment holidays on overdrafts, loans and credit cards until October as people continue to feel the financial impact of the COVID-19 pandemic. While a policy that allows those whose income has been hit by the lockdown to defer payments was expected to be wound up at the end of July, the watchdog has proposed an extension of the support window.
3. 1,067,340 businesses take out government-backed loans
1 1. BoE pumps an extra £100bn into the economy The Bank of England (BoE) has announced a new stimulus package for the economy to mitigate against the impact of the coronavirus crisis and lift inflation from the current 0.5% and closer to the 2% target. The Bank confirmed a fresh £100 billion in quantitative easing, with this following a £200 billion boost announced in March. This £100 billion takes the BoE’s asset-purchasing programme to £745 billion, a figure equivalent to around a third of GDP. 10 | NACFB
The lending sector has supported more than one million businesses through the three main government-backed lending schemes in just over three months, figures published by HM Treasury have revealed. 1,067,340 facilities worth £45 billion have so far been approved through the CBIL, BBL, and CLBIL schemes. This includes 1,013,410 Bounce Back Loans worth £30.93 billion, 53,536 loans worth over £11 billion through the Coronavirus Business Interruption Loan Scheme and £2.58 billion through the Coronavirus Large Business Interruption Loan Scheme.
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4 4. UK debt worth more than the economy The UK borrowed £55.2 billion in May, nine times more than in May 2019. May’s borrowing took total government debt to £1.95 trillion – or 100.9% of GDP, with national debt now worth more than the economy for the first time since 1963. While government spending included funding for support measures rolled out amid the coronavirus crisis, income from tax, National Insurance and VAT fell, with HMRC data showing tax payments were down £16.2 billion – or 43% – on the same period last year.
5. Specialist lenders call for parity with big banks Non-bank lenders met with Treasury officials as they lobby for access to ultra-cheap funding from the Bank of England and the same loan guarantees provided to big banks. Stephen Haddrill, director general of the Finance & Leasing Association (FLA), warned: “Non-banks are stretched between providing forbearance, satisfying the people they get their funding from, and trying to satisfy demand for new lending.”
