The World Health Organisation (WHO) has announced that more than 300,000 cases of coronavirus recorded worldwide, an increase of 100,000 in just four days. As the NHS announces the total number of UK deaths has reached 335, the government has announced further action to limit the spread of coronavirus.
Closure of all non-essential shops
Throughout the country people have been following the governments advice to practice social distancing, however in many areas it is clear this advice has not been adhered to. Following a meeting between Boris Johnson and the emergency Cobra committee, new rules have been imposed on the country. All shops which sell non-essential items will be forced to close, including places of worship, libraries, playgrounds and outdoor gyms. The only stores which can remain open are supermarkets, food stores and pharmacies.
There are many European countries and states throughout the US which have also ordered a closure of all non-essential shops. Although the government only announced these measures last night, a string of high street retailers had already announced their stores would be closing, including Greggs, Costa Coffee, McDonald’s, Primark, Waterstones, Debenhams and Next.
The closure follows Friday’s order for all pubs, cinemas, restaurants, theatres, cafes and other venues to close. According to Springboard, the average footfall last week showed a 31% drop-in high-street visitors compared to the same period last year. This is an unprecedented decline and based on Springboard figures, it is three times greater than the worst footfall decline ever recorded.
Pressure for support for self-employed workers
Pressure is mounting on the government to provide an increased level of support to self-employed workers. Currently, roughly 15% of the UK workforce is classed as self-employed, with many already struggling from a dramatic fall in business. Mervyn King, former governor of the Bank of England has warned the economic threat from coronavirus is far more serious than the 2008 economic crash. The government is being pushed to provide the same level of support to self-employed people as the support being rolled out for company employees.
This would provide every self-employed person with a wage equivalent to 80% of their usual earnings, in line with those who are employed. Currently, self-employed workers are entitled to a much lower amount of £94.25 per week in universal credit benefits. Although, the Chancellor has announced further measures such as deferment of self-assessment income tax payments for 6 months, organisations such as The Independent Workers Union of Great Britain (IWGB) are warning that this may not be enough.
Launch of the Coronavirus Business Interruption Loan Scheme
Yesterday marked the launch of the Coronavirus Business Interruption Loan Scheme (CBILS), designed to provide loans of up to £5million to businesses over the next 6 months. There are currently more than 40 lenders offering finance via the scheme in the form of standard term loans, overdrafts, asset finance and invoice finance. Depending on the type of finance offered, loan terms will range from 3 months up to a maximum of 10 years.
To be eligible your business will need to be based in the UK, with a turnover of below £41million. Every type of business is eligible to apply, whether you are a sole trader, partnership of limited liability partnership. You will need to make a financially viable proposal, as the lender will only approve applications if they believe the funds will help your business to trade through the downturn in business.
As with all forms of lending your application will need to meet the eligibility criteria of the chosen lender, however the government is providing security for 80% of the loan amount to boost your chances of approval. If your business is eligible for a loan with the lender’s usual terms, you will be offered these rather than those offered via the CBILS. If you avail of the scheme, you will be 100% liable for meeting the repayments.
Here at BusinessComparison we understand that this is one of the most challenging times many businesses will ever face. Whether you are looking for finance or a way to reduce your outgoings, our team can help you compare everything from loans and credit cards to utilities and business insurance. We understand that every business will have unique financial circumstances, which is why we have a panel including both mainstream and alternative providers. To find out more about how we can support your business, please contact our team today.