Government to launch ‘Pay As You Grow’ loan payback scheme

The Government is to launch a ‘Pay As You Grow’ loan payback scheme to provide flexibility for businesses who took out loans amid the coronavirus crisis. Speaking in the Commons on Thursday, Chancellor Rishi Sunak said the repayment time will be extended from six years to a decade, nearly halving the average monthly repayment. He added that businesses can now choose interest only loans and that those who take on the initiative will not see their credit rating affected. The Government is also starting work on a successor loan plan to begin in January. The application deadline for coronavirus loan schemes has been extended to November. Charlotte Crosswell, chief executive of Innovate Finance, which represents fintech and non-bank lenders, said she was “encouraged” by plans for a “long-term solution for SME financing.” Elsewhere, Miles Celic, chief executive of TheCityUK, said the loan extensions would help “to preserve many viable firms, allowing them the chance to return to growth after the pandemic has passed”.