UK banks are rolling out emergency loans to businesses that are showing signs of financial strain amid the coronavirus outbreak.
High street lenders including Barclays, Santander UK and Royal Bank of Scotland began contacting thousands of business customers in recent days to check whether factory disruptions in China were putting their supply chains and cash flow at risk.
Barclays has instructed its 1,500 relationship managers to contact at-risk customers, and has since signed off its first batch of overdrafts and short-term loans designed to ease the financial strain of the coronavirus outbreak. They include cases where Chinese deliveries have been severely delayed or payments have not been received from clients who are under quarantine overseas.
The chief executive of Barclays’ business banking division, Ian Rand, said: “Our network of relationship managers has been reaching out to SMEs [small and medium-size enterprises] across the UK to see if they require additional support during this time, as we do regularly when we see any events which may have an impact on our clients.
“Barclays is ready to help, whether that’s with managing cash flow or any other support, and we encourage any customer who needs guidance to call us or contact their relationship manager.”
The Guardian understands that RBS is trying to contact about 5,000 of its large and small business customers who may be exposed to coronavirus disruptions each week, and is offering similar financial relief packages on a case-by-case basis.
RBS and Barclays each have more than 1 million business customers in the UK.
While the number of UK firms requesting emergency funding is understood to be fairly small, it is expected to rise over the coming days. Many small business customers have been using extra supplies which were stocked in preparation for the Chinese new year holidays. The real impact from issues such as delayed deliveries will start to show once these supplies run out.
An RBS spokeswoman said: “We are monitoring the potential impact of coronavirus across our personal and business customers to ensure we can support them appropriately through any period of disruption.
“We have a strong track record in working with our customers who are affected by disruption outside of their control. We also have operational resilience plans in place that reflect guidance from Public Health Authorities to ensure we can continue to serve our customers.”