The Programme Delivery Board of the Coventry and Warwickshire Local Enterprise Partnership (CWLEP) has agreed to contribute up to £2 million of funding to help SMEs in Coventry and Warwickshire suffering with cash flow as a result of the Coronavirus pandemic.
The additional money forms part of a larger package of support already confirmed by Coventry City Council, Warwickshire County Council, Nuneaton and Bedworth Borough Council, Rugby Borough Council and Warwick District Council to assist SMEs impacted by Covid-19.
The package of support also includes the continuation of the ‘The Duplex Investment Fund’, which was set up to help with investment and growth in the local economy through a grant and loan scheme.
SMEs in Coventry and Warwickshire will be able to apply for funding from Coventry and Warwickshire Reinvestment Trust (CWRT), who are delivering the scheme through the government backed Coronavirus Business Interruption Loan (CBILS) that is due to expire at the end of September 2020.
The funding will be available to local businesses who are experiencing lost or deferred revenues, leading to disruptions to their cashflow due to the impact of Covid-19. There will be flexible repayment terms and it will be interest-free for the first 12 months.
Sheridan Sulskis, Executive Director of CWRT, said it is estimated that this additional funding could lead to the safeguarding of 550 jobs.
She said: “A survey from the British Chambers of Commerce suggested that 20 per cent of businesses will need support from the CBILS and we are well positioned to channel investment into businesses unable to secure finance from banks and other mainstream lenders. We are dedicated in supporting businesses to rebuild, adapt, diversify and add new employment in the months to come.
“As an ethical lender, this additional funding will enable us to help even more businesses ease their cash flow at a time when they need it the most which, in turn, will play a part in their survival and boost the economy in Coventry and Warwickshire.”
Nick Abell, interim chair of the CWLEP, said cash flow remains the primary concern for many businesses.
He said: “As the situation surrounding Covid-19 has evolved, SMEs across Coventry and Warwickshire have very quickly faced liquidity challenges, job losses and having to put projects on hold as they are struggling to make payroll.
“There is still a clear need for additional working capital for businesses in Coventry and Warwickshire, and this is becoming increasingly urgent because of the need for cash flow for business survival but also because CBILS guarantees will stop becoming available at the end of September.”
Sarah Windrum, board director and chair of the digital and creative business group at the CWLEP, and FSB West Midlands policy leader, said this new loan funding could play a major part in helping some SMEs survive in the short and medium term.
She said: “It is critical to recognise the importance of SMEs being able to access finance quickly during this pandemic.
“The impact of Covid-19 is continuing to affect businesses and by helping to fill the gaps in mainstream lending, this scheme will provide loans which are specifically designed to support SMEs through volatile credit markets and tightening credit conditions.”
Caption: Nick Abell, interim chair of the CWLEP