Businesses may have access to more cash in order to buy more stock or increase their level of commercial van insurance cover, thanks to a new scheme backed by the government promoting more affordable lending to small and medium sized businesses, experts say.
Many owners of small businesses may be able to consider expanding their options in regards to insurance cover related to their business activities, now that they have better access to finance. As a result, any firm that has been holding off on increasing its fleet of commercial trucks or vans because thy could not afford to purchase expanded van insurance can now do so, which will lead to their investment being properly protected against harm.
The Government’s recent confirmation that the nation’s lenders will be offering loans discounted by 1 percentage point from their standard rates to SMEs under the new National Loan Guarantee Scheme has been met with relief by businesses that have struggled to gain access to credit since the global economic downturn. Around £5 billion in borrowing guaranteed by the government has already been made available, with the scheme having a final target of £20 billion over a period of two years.
Businesses that are taking advantage of these new, cheaper loans guaranteed by the Government are taking precautions to protect their investments, especially when the cash borrowed is to go towards increasing a fleet of motor vehicles. With the cost of car insurance rising ever higher, it would be prohibitively expensive to purchase cover without the newly-increased access to credit, experts say.