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Will SMEs Face A Funding Gap Post CBILS?

Estimated Read Time: 3 Minutes

JESSICA LAMBERT , 26 January, 2023

It’s a question that’s been lingering on the minds of key decision-makers in recent weeks, with yesterday’s Spring Budget announcement providing the answers so many have been waiting for. The government’s predicted outlook is not so bleak after all, with a fast economic recovery on the cards and ‘normality’ for businesses by April 2022.

However, when truly opening our eyes and looking beyond the rainbows and blue skies presented before us yesterday, is business growth post-pandemic really as clear cut as they’ve led us to believe?

Probably not.

So far, the government’s support packages for SMEs have been generous, especially when compared to what’s on offer elsewhere in other countries. But despite spending hundreds of billions on support for jobs and businesses, there are of course many UK SMEs who have had to go it alone, as they, unfortunately, found themselves in the much-dreaded, solitary grey zone.

Missing out on government-backed schemes due to falling short of the strict criteria has not been an uncommon occurrence, with thousands of SMEs falling through the cracks and narrowly avoiding access to the millions set aside in business relief.

It’s clear that thus far, there’s been a funding gap – which suggests that once again, despite the new support on offer, businesses across the country will find they are being denied financial aid when these new programs come into play.

Shiny, new grants will be launched in April but as expected, come with their fair share of restrictive criteria. The new Recovery Loan Scheme will be welcome news to the many businesses hoping to access a similar CBILS offering, with the scheme scheduled to run until the end of 2021. They are perfect for businesses wanting to borrow large amounts of cash, with up to £10m on offer to survive the hard months ahead, even as we inch closer to normality.

But what about those businesses that were left behind in the dust when CBILS launched, unable to tick every requirement? What about those businesses who want much smaller amounts to avoid getting themselves into a financial hole they can’t dig themselves out of? What about those SMEs that can’t access invoice or asset finance, instead pinning their hopes on a traditional term loan, only to have them dashed?

The solution must be led by the challenge thousands of SMEs find themselves up against and it’s down to both the alternative and Fintech industries to provide these funds as the banks simply can’t do it at speed – or indeed the speed needed to help prop the UK’s backbone up again.

Change Is Coming

Now, equipped with our successful vaccination program and our roadmap out of lockdown, businesses must now confidently stride out from the shadows and “turn on” operations once again. Funds will need to be readily available if the economy is to truly recover as rapidly as the Chancellor has promised and lenders must step up and deliver on the primary need of SMEs right now.

Yes, there will be a funding gap – but only if alternative lenders don’t do what must be done and fail to provide funding solutions that are suitable for a post-lockdown business climate. It’s critical that as an industry, we adapt our offering, make different financial assumptions, and offer new products that encapsulate the barriers most businesses have faced over the past year. There needs to be an overhaul of the commercial finance industry and as part of the process, some basic aspects must change – credit policies should look different to how they did 12 months ago, underwriting should follow an altered protocol and almost instant decisions should become the norm.

A Cash Flow Boost Without A Serious, Long-Term Commitment 

At Nucleus, we pre-empted this funding gap post-CBILS and started working behind the scenes to design a product that would genuinely make a difference to UK SMEs. Our Business Growth Loans were created with smaller businesses in mind, with speed and simplicity topping our priority list. We understand that businesses need an immediate injection of cash to be adequately prepared for when restrictions are lifted and that is exactly why we created this short-term, flexible product.

Through our Business Growth Loans, businesses can borrow as little as £3k, up to £25k and pay back their loan within a speedy 6 months. Better yet, businesses can apply for quarterly top-ups to ensure their cash flow remains healthy once we finally reach a place of normality.

Our state-of-the-art technology enables us to make rapid decisions and you’ll have the answer you need far quicker than any bank! We like to keep things simple, quick and hassle-free, so if you want to secure the funding your business needs ahead of June, all whilst keeping your main focus on the day-to-day operations to come, get in touch with our friendly team today.





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