Time for small businesses to pay back emergency state aid

Small companies struggling to repay emergency loans have several options, says David Prosser.

High-street banks
Lenders are not allowed to demand personal guarantees on loans of less than £250,000
(Image credit: © Chris Ratcliffe/Bloomberg via Getty Images)

The post-lockdown recovery has been a relief to struggling small businesses, but many now face a new problem. They are being asked to repay funding provided by the Coronavirus Business Interruption Loan Scheme (CBILS) and Bounce Back loans, the government-backed emergency aid packages.

By some estimates, as many as two-thirds of firms may struggle to make these repayments, although official statistics suggest default rates, for now at least, are lower than the most pessimistic predictions.

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David Prosser
Business Columnist

David Prosser is a regular MoneyWeek columnist, writing on small business and entrepreneurship, as well as pensions and other forms of tax-efficient savings and investments. David has been a financial journalist for almost 30 years, specialising initially in personal finance, and then in broader business coverage. He has worked for national newspaper groups including The Financial Times, The Guardian and Observer, Express Newspapers and, most recently, The Independent, where he served for more than three years as business editor.