Peer-to-peer lending industry stakeholders have differing views on the success of the government’s emergency loan schemes, with some highlighting their limitations such as fraud and lack of inclusivity.
The coronavirus business interruption loan scheme (CBILS), bounce back loan scheme (BBLS) and coronavirus large business interruption loan scheme all end on 31 March after deploying £73bn to businesses as of February, according to UK Finance data.
They will be replaced by the new recovery loan scheme, which will launch on 6 April.
Stuart Law, chief executive of CBILS-accredited P2P lending platform Assetz Capital, called the schemes “very, very, very successful”.
“Without them the country would have collapsed,” he said. “Simple as that.”
Lee Birkett, founder of non-accredited lender JustUs, also labelled the schemes a success, but criticised the number of businesses they excluded and the lack of fintech involvement in the deployment of funds.
“I think you can count them as very successful,” he said.
“There has naturally been a large number of businesses excluded and it’s disappointing there was nothing to address that and plug the gap.
“When you look around it’s been a successful programme, but chose not to involve fintech, which was a big mistake.”
Meanwhile, David Bradley-Ward, chief executive of asset-backed P2P lending platform Ablrate, which was not accredited for the schemes, warned of the risk of fraud with BBLS and suggested that CBILS did not go far enough.
“I think the bounce back loans were amazing for some businesses, but when it all unravels, it will be found to be a total disaster because it’ll be riddled with fraud and businesses will be chased for repayments,” he said.
“I can’t see anything else than the government turning it into a grant in the end. The government will have the most aggressive collection agencies going after people and when you bankrupt small businesses and they go onto TV it’ll be a PR disaster, so I think the loans will be turned into grants and be written off.
“I think CBILS was good but not wide enough and the banks being in charge of it probably didn’t get enough out of the door as they should do.”
The schemes have also previously come under fire from P2P platforms for distorting the market.