Rishi Sunak has had an interesting few months…
Hailed as a future PM at the beginning of the crisis, with his decisive leadership and promises to ‘do whatever it takes’, and then criticised from all angles and by all sorts of people, with accusations that he had forgotten about them and their individual circumstances.
One of the measures that The Chancellor has set up is the ‘Bounce Back Loan’ scheme, which aims to help small businesses keep the doors open with loans of up to £50, 000.
The terms are ‘attractive’ as promised, whilst the checks are about as minimal as you’re ever likely to see.
Rife for opportunists?
…but very dangerous for the hopelessly optimistic and unknowingly naïve as well.
There has been some concern from the Business Banking Resolution Service (BBRS), following a survey of theirs, that nearly half of those taking advantage of this scheme don’t actually expect to pay the money back.
That’s a huge problem, not least because we could be talking about leaving the country with a shortfall of several billion pounds at some point down the road, but also because it shows a worrying trend amongst cash strapped business owners.
Taking whatever you can get, as some businesses appear to be doing, might seem like the safest thing to do when you’re trying to keep the boat afloat.
But what happens when you take on too much?
Too much debt can sink a business, like too much water can sink a boat, and so it is in the interests of every business owner to make a plan for the sensible investment of the loan money.
Because it’s a loan. Not a grant.
It will have to be repaid, and if it isn’t, businesses and business owners are likely to be pursued through the courts.
So what constitutes a ‘sensible investment?’
Get on top of your finances maybe its a good opportunity to finally pay off your outstanding CCJs and High Court Writs?
Well, it’s not exactly growth, but it’s a start.
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