The Tories realise their loans to small businesses has failed and now covering 100% of all loans but banks remain the vehicle to get the money. As this article states deeply flawed.
Richard Taylor
posted a new discussion
17 hr ago
Edinburgh Group Coordinator and Positive Money Non-Executive Director
Money for Nothing: 100% State Backed Loans
I'm sure most of you will have seen the announcement that the Govt will now take on 100% of the risk of the CBILS loans to small businesses. By and large, banks have spectacularly failed in advancing loans to small businesses and I'm sure much damage as occurred as a result. Maybe that's because they don't have any real pedigree in making any loans to small businesses since they seem more interested in loaning against property instead, The whole idea of using banks as the transmission mechanism to get money (as loans) into the economy seems deeply flawed.
So now the chancellor has fixed it by offering 100% state guarantee of the loan, whilst paying (the no doubt exorbitant) interest and probably arrangement fees to the banks for the first year. So this is nothing more than a gravy train for the banks with no risk to their shareholders. The Govt can borrow at historically low rates (or choose to monetise if that's your preference) to fund the businesses directly, but we have this bankers subsidy scheme instead,
Small firms to get 100%-taxpayer-backed loans
Small firms are to get access to 100% taxpayer-backed loans after they raised concerns about
