UK – It seems the chance which banks had to claw back some of the credibility they lost when the sector suffered humiliation in 2007-8 is slipping away fast if the Freight Transport Association (FTA) is to be believed. Whilst the government has expressed a keen interest in backing loans given out to aid businesses through the tribulations spawned by Covid-19, the lenders themselves are apparently not so enthusiastic.

“Lenders continue to stall on making decisions on applications for the loans which are intended to keep our sector afloat, yet government has so far failed to deliver on its promise to push decision making along. In the meantime, logistics businesses are now starting to face emerging holes in their cash flows caused by a lack of billable work from April, when the crisis really took hold.

“FTA’s weekly research of the whole industry shows that almost a fifth of our members are in danger of financial collapse within eight weeks, but only 5% have been successful with their CBILS applications. The survey also reveals that over a third of logistics SMEs are stuck in banking purgatory, either not eligible, unsuccessful, still awaiting a decision, or in need of more information.

“Lenders are failing to process applications for financial support from stricken businesses quickly enough. The overall application process needs to be much faster, and more transparent, to ensure the necessary funding reaches the businesses that we all rely on to deliver vital goods 24/7, and whilst the creation of Bounce Back loans, announced last week after intense lobbying from FTA, will help the very smallest logistics businesses, it still leaves thousands with no alternative to CBILS for averting their impending cash flow crunch.

<p style="margin-top:0;margin-right:0;margin-bottom:8px;margin-left:0;box-sizing: border-box;open sans"orphans: 2;-webkit-text-stroke-width: 0px;word-spacing:0px">”The banks are clearly still getting in the way of the application process for CBILS, either because they will not accept any risk, or because their processes are taking up too much time, which prevents logistics operators from even making a CBILS claim.”

Source: handyshippingguide