Business lender Iwoca has asked the UK’s largest banks to partner with alternative lenders to ease the backlog of applications for the coronavirus business interruption loan scheme (CBILS).
This follows the platform’s announcement of a £100m fundraising round to fund new CBILS borrowers.
The platform’s analysis has found that the gap between the number of CBILS applications and approvals has grown from 40,560 in mid-May to 58,707 by the end of July.
Iwoca’s chief executive Christoph Reiche has written to the chief executives of every UK-based bank, asking them to work with Iwoca and other finance providers to ensure that small- and medium-sized enterprises (SMEs) can access finance as quickly as possible.
“We want to give small businesses the best chance of finding the support they so clearly need, which means the banks must work with us,” said Rieche.
“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.”
Rieche has asked banks to refer excess loan applications to fintech lenders so that they can help to clear the backlog of applications from struggling SMEs. These would include businesses who have been waiting for more than two weeks for a response to their application, businesses which have either withdrawn their application or have filed incomplete applications, and smaller firms which require a relationship manager to complete their applications.
Every business which applies for a CBILS facility up to £350,000 from Iwoca is offered access to a relationship manager to guide them through the application process. On average, its customers receive a final decision and funds in their bank account within three days.