Alternative SME lender Iwoca has announced a £100m raise to scale its Coronavirus Business Interruption Loan Scheme (CBILS) offering and fund customers for the first time.
The CBILS provides financial support to smaller businesses across the UK that are losing revenue, and seeing their cash flow disrupted, as a result of the COVID-19 outbreak.
The scheme is a part of a wider package of government support for UK businesses and employees and is set to end in autumn.
iwoca became an accredited lender under the scheme last month, and now plans to reach out to the CEOs of the UK’s largest banks urging collaboration to ensure small businesses are accessing finance as quickly as possible through scheme.
The firm says its analysis of HM Treasury data reveals that a gap between the number of CBILS applications and approvals has grown every week since the launch of Bounce Back Loans, rising from 40,560 in mid May to 58,707.
It claims demand for CBILS has remained consistent over this period, with an average of 3,481 new weekly applications – one every three minutes. In the last week of available data, 3,729 new applications were submitted.
It estimates that a large number of the 790,000 firms with more than £250,000 in annual revenues could yet apply for CBILS, increasing pressure on large lenders dealing with demand for finance from small businesses in the application process.
Iwoca is now calling on the UK’s largest banks to refer those businesses who they do not have the ability to serve, namely those which have been waiting for more than 2 weeks to receive feedback on their application, have either withdrawn or have incomplete applications that haven’t been followed up by the banks’ staff, and smaller firms requiring a Relationship Manager to complete their application.
Christoph Rieche, CEO of iwoca said: “We want to give small businesses the best chance of finding the support they so clearly need, which means the banks must work with us.
“It’s not acceptable that thousands of the businesses applying for CBILS are left hanging for weeks or even months without getting a decision from their bank. As an industry we have a joint responsibility in supporting this effort so that SMEs can access finance fast to survive and thrive.”
Last year the Camden firm came 55th in BusinessCloud’s 100 FinTech Disrupters.