Bounce Back Loans – what to do if you are struggling to repay them
In recent months, the Chancellor has taken unprecedented measures to support businesses through the current health and economic crisis.
One of the most significant of these has been the bounce back loans provided to companies that have a viable future. However, it didn’t take long before the Government was being warned that many of these companies will struggle to repay the tens of billions of pounds that they have borrowed.
It is has now emerged that the Government are enlisting the assistance of Debt Recovery agencies in order to try to recoup the estimated £38,000,000,000 lent to over 1,000,000 small businesses as they struggle to make the repayments required under the terms of the loan, as this task will be too colossal for the banks to tackle by themselves.
But what can you do if you are one of these small businesses who would currently struggle to make repayments? The most important thing to do now is to assess your cashflow situation and how you can recover as much debt owed to you as possible. This means looking closely at how many debtors you have, how much they owe and whether they may have the means to repay the debt.
One of the simplest ways to do this is to check credit agency sites to view any recent changes in the debtor’s accounts, CCJ’s and payment records (many of these sites will tell you how many days past due invoices are finally paid). You can also do an internet search for any news on potential insolvency or check the London Gazette for the same.
If you believe the debtor is in a position to pay, then do not delay and attempt communication straight away to try to obtain payment, or a repayment plan. If this fails, then it may be time to enlist our no recovery no fee service to try to obtain payment through a Letter Before Action.