MSP contacts banks for help on commercial borrowing rates

Highlands and Islands Labour MSP, David Stewart, has contacted Scotland’s bank chiefs asking for their input to save businesses in the region who are facing unprecedented hardship, and possible collapse, as a result of the COVID-19 pandemic.

The MSP has been contacted by business owners appealing for help in getting Scotland’s banks to charge their commercial borrowers the Bank of England base rate of 0.1%.

Businesses are desperate for help and say the business interruption loans being heralded by the Scottish Government are not the answer with businesses struggling to get hold of their banks and, when they do, many of them are being asked to stump up collateral, such as their homes, to secure the business interruption loans.

Mr Stewart says further that the minority of businesses who are being offered the interruption loans are having to wait an inordinate amount of time for the loans to be processed, time most businesses don’t have right now.

David Stewart said “The concerns about the financial effect the COVID-19 outbreak is having on businesses in the Highlands and Islands region, and indeed throughout Scotland, is deepening day on day.

 “I have contacted the Scottish Government about this but their response has been weak. They say the interruption loans are available and that their hands are tied as the regulation of financial services is reserved to the UK Government.

 “This is not good enough.” continued Mr Stewart.

 “I appreciate many banks are offering to defer capital payments on commercial loans but this is not enough. On top of that, only a small number of those applying for business interruption loans are being approved.

 “Business owners want to see the Bank of England base rate applied to minimise debt going forward and potentially save thousands of them from collapse. Given the severity of the situation and the need for urgent action to be taken, I have now contacted the banks directly and I will be having discussions with them in coming days.”