Only 15% of COVID-19 Working Capital Scheme has made it to Businesses
Only 15% of COVID-19 Working Capital Scheme has made it to Businesses according to Aontú leader Peadar Tóibín TD, he stated;
“A large number of businesses have been in contact with our offices. These are business that were perfectly healthy before the Covid-19 crisis but who are in dire straits with regards funding. Many have healthy balance sheets are ready to start trading but have little or no Working Capital. These business have applied for the COVID-19 Working Capital Scheme lending scheme yet have been refused. Others are experiencing very long processing times”.
“I have learned today that the Central Bank SME Regulations which govern the lending criteria under which this money is being lent has not changed since before the Covid-19 Crisis. This means that business that are in trouble because of the Covid-19 crisis can’t gain access to money that has been made available due to the Covid-19 crisis. This is wrong and it needs to change”.
“As a results months after the scheme was announced only 70 million of the fund has been lent. From speaking to those in the industry, there is a concern that that much of the money will remain with the banks and won’t make it to businesses at all unless there is significant change to the lending criteria. The loans are also too dear. That such a level of profit will be made on a government guaranteed loan in a time of crisis does not make sense”.
“Currently the Central Bank is in discussions with banks about possible changes. However, time is of the essence here. These discussions need to be accelerated and the decision needs to be made. Otherwise each week business will go to the wall.
