Covid loans stress ‘has damaged my health’

BUSINESS BOSS BACKS CALL TO CHALLENGE REPAYMENTS

A business manager says repayments on a £50,000 loan to save her business have destroyed her relationship and are damaging her mental health.

Anne-Mari Niemela, pictured, who runs FoxPrint, which employs nine people in Shepshed and Swadlincote, took the maximum under the Bounce Back Loans Scheme that ran for the first year of the pandemic.

The bank loans were guaranteed by the government, but repayments would have to begin after 12 months.

Many companies took the money hoping the first lockdown would be the last and the economy would be recovering by the time the repayments had to be made.

But many, like FoxPrint, now face paying back the money while they still struggle as a result of the pandemic.

Ms Niemela said: “The government moved the goalposts repeatedly. It’s very unsettling and stressful having these loans hanging above your head.

“We thought our business would be back on its feet very quickly, but the repeated lockdowns meant it was all stop/start. It didn’t give us a chance.

“This has affected many people’s mental health.

“I think the government tapped into people’s sense of desperation and panic.

“It is a desperate situation, as we are also still trying to pay back VAT we owe alongside this.

“I am now on anti-depressants and my relationship with my partner has broken up because of all the stress.”

She joined Back British Business chief executive Wasif Mahmood at a roadshow at Leicester Novotel Hotel this week to speak to fellow business leaders.

Their campaign argues political leaders are failing to address extreme pressures struggling UK companies who took out such loans are now under.

Mr Mahmood said: “The government undertook a process whereby it went to the banks and said that it would guarantee their loans. Many businesses weren’t aware of this and thought the guarantee was to them directly.

“Normally, when you do take out a loan from a bank, it is protected under the Consumer Credit Act.

“The government removed the protection and armour of the Consumer Credit Act from the BBL scheme.

“There was also an attempt to remove the protections that are also afforded under the Financial Services Markets Act 2000.

“But there is still a means of challenging these particular loans on the basis of common law. The courts can look at whether or not it is right these loans have to be repaid in whole or in part using equitable principles.

“We are using the law in this way as we believe it is our duty to help build back British business and this country’s economy.”

A government spokesman said: “From the start of the pandemic, our priority was to protect jobs and livelihoods, which is why we acted quickly to launch these schemes, which have helped over a million businesses.

“We have always been clear that these are loans, not grants, while ensuring companies can repay their loans on the terms which work best for them through our Pay as you Grow measures.”