Furlough ends 30th September - Are you ready?

Furlough was introduced back in spring 2020, to stop people being laid off by their employers during lockdown. It applies across the UK for all sectors.

The government initially paid 80% of the wages of people who couldn't work, or whose employers could no longer afford to pay them - up to a monthly limit of ￡2,500.

Flexi-Furlough then came in as restrictions were lifted.

In July 2021 employers were required to pay 10% of salaries - with the government's contribution falling to 70%.

In August and September, the government's contribution reduced further: it now pays 60% and employers pay 20%.

From 1st October the scheme will end and employers will have to make important and difficult decisions - employers will need to decide whether to take back their furloughed workers?or make them redundant. Either way, this could prove to be a costly exercise, particularly if they are in an industry that has been hard-hit. Some employers with workers on furlough may find that they cannot afford to take them back as their industry is so disrupted - travel and logistics, hospitality and leisure. Pubs, restaurants, and hotels have only been open since mid-May and have enjoyed a few months of cash ringing in the tills again, but playing catch up on unpaid bills, and credit commitments has certainly not been easy.

The Recovery Loan Scheme has now been launched and more and more lenders on our panel are being accreditted. As an experienced broker, we have been successful in securing funds to ease cash-flow pressures for many businesses. Some funders are offering their BAU products now if they have chosen not to sign up for the Government supported scheme and these too have been crucial for business owners. The world of business credit is a minefield right now, and knowing who to go to and why and having someone on your side fight your corner for you, has never been so important in applying for business funding.

If your business is facing an increased pressure on wages over the coming months, it is important to understand how this will impact your working capital. You may also be faced with putting any planned growth and expansion plans on hold due to wage increases.

We are delighted to share that businesses that operate with a large percentage of their income coming via card payments have been able to be supported by a product called Merchant Cash Advance. It is proving challenging for funders to approve loans where the business has been loss-making, but this facility has really become a lifeline for many businesses, particularly in retail and hospitality.

Call us now to discuss your requirements and we will handle your application with expertise and compassion.