Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of providing direct access to funding for the Bounce Back Loan to (a) non-bank organisations and (b) electronic money institutions whose clients may be unable to access the Bounce Back Loan through other lenders.

There are 29 accredited lenders under the Bounce Back Loan Scheme (BBLS) including challenger banks and non-bank lenders (NBLs) who have played a vital role in providing 1.4 million businesses with financial support worth over £42 billion throughout the Covid crisis.

The Government position remains that it does not provide capital to financial institutions, who must source their own funding. Last year, the Treasury issued a Call for Evidence in order to explore a possible private-sector led funding model that would support accredited NBLs to access finance to participate in the BBLS. Based on the feedback we received, including the significant commercial challenges highlighted by both non-bank lenders and the banks, the Government decided not to pursue this funding solution any further. Notwithstanding that decision, we have made changes to allow the transfer and assignment of the Government guarantee for all government-guaranteed loan schemes loans, which is something that NBLs have requested, to support their ability to access funding from commercial partners.