iwoca raises £100m to scale CBILS offering

Business lending FinTech iwoca has called on the UK's biggest banks to help ensure small businesses are accessing finance as quickly as possible through the Coronavirus Business Interruption Loan Scheme (CBILS).

This comes as the firm announced a new fundraising round of £100 million, which will be used to scale its CBILS offering and fund new customers through the scheme for the first time.

The pandemic has seen banks receive huge demand from businesses for financial support. More than 7,000 CBILS facilities per month have been approved since May, similar to the volume of loan approvals for small and medium-sized enterprises (SMEs) before COVID-19.

However, the additional operational pressures for banks in approving over one million Bounce Back Loans and providing consumer credit support means that thousands of small businesses are facing delays in their CBILS applications.

Analysis of Treasury data by iwoca showed that that the 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.

Demand for CBILS has remained consistent over this period, with an average of 3,481 new weekly applications. In the last week of available data, 3,729 new applications were submitted.

With CBILS due to close in September, demand is likely to rise over the coming weeks, especially as other government support measures such as the Job Retention Scheme wind down. Indeed, iwoca estimates that a large number of the 790,000 firms with more than £250,000 in annual revenues could yet apply for CBILS.

Christoph Rieche, chief executive of iwoca said: “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.”

Chris Matthews, founder and chief executive of Silverlink Clinics, has been waiting to hear from his bank for over three months. “We’re still waiting for a decision, 12 weeks later and we’ve been promised we’ll get one by the end of the week for the last nine weeks.

"My finance director has been on the phone to my bank constantly trying to get them to ring her back - she’s been leaving messages that don’t get answered, promises that don’t get kept.”

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