80% Of Builders Left In Dark By Banks On Coronavirus Loan, Says FMB

The Federation of Master Builders (FMB) is calling on the Chancellor to address the blockages in the Coronavirus Business Interruption Loan Scheme (CBILS), as small builders across the country are struggling to keep their businesses afloat.

It follows an FMB survey of 579 members this week that found:

Half (50%) of FMB members who have applied for the Coronavirus Interruption Loan Scheme (CBILS) have found the process either ‘somewhat’ or ‘very difficult’.
So far, 10% of FMB members who have applied for a loan have been rejected with the vast majority (84%) still waiting to hear back from their bank 29% of SME house builders believe they are not able to apply for a loan through the scheme
Local builders are being asked for a personal guarantee on application, or being forced to take out an overdraft with high interest.

Brian Berry, Chief Executive of the Federation of Master Builders (FMB), said: “While we understand the immense pressure banks are under at the moment, the Coronavirus Business Interruption Loan Scheme needs to be fast-tracked and the criteria clarified as soon as possible to stop small construction firms going to the wall.

“I am hearing time and time again about members who have been told by their bank that they will get back to them and never do, and others who have had to wait for hours on the phone to speak to their bank manager. Others have been told by their lender that they must apply by post. It is no wonder that members are reporting they are finding the process difficult. Sadly, we are still hearing of members who are being asking for a personal guarantee or being forced to take out an overdraft with high interest."

Mr Berry concluded:

“There also seems to be some confusion as to who is covered by the scheme. SME house builders are crying out for financial support, but many are being turned away by lenders. The Government should work with Homes England and the devolved administrations to help find a way to keep SME house builders afloat in this time, ensuring that they are ready to resume building high quality homes after the coronavirus outbreak.”