Banks set to hand £20bn to business

BRITAIN’S biggest banks pledged last night to immediately make available £20bn of emergency cash to small and medium sized enterprises brought to their knees by coronavirus.

The commitment was made at a high level meeting called by the Chancellor Rishi Sunak at the Treasury attended by the governor of the Bank of England Mark Carney, his successor Andrew Bailey and the chief executives of the major banks.

At the follow-up session to his coronavirus budget – at which the Chancellor committed £12bn to combat disruption caused by the virus – Sunak said the Government would do ‘everything it takes to support businesses through this difficult time’.

His Budget stimulus package includes a ‘Coronavirus Business Interruption Loan Scheme’, which provides lenders with a guarantee of 80pc on each loan, extending statutory sick pay, business rates relief, and small business grant funding.

The Bank of England on Wednesday also unleashed an emergency stimulus package worth up to £290bn, designed to boost lending to struggling firms and households.

Carney declared the Bank would be ‘monitoring closely how the banks use the enormous resources to help keep firms in business.’

Stephen Jones, boss of UK Finance, which represents the banking industry, noted the banks are already responding to the crisis through repayment holidays, invoice free extensions and fee free emergency loans.