Supporting SMEs during the pandemic: How fintech lenders can lead the charge

Chirag Shah, CEO, Nucleus Commercial Finance

As the economy begins to reopen after months of lockdown, businesses across the country need vital funds to ensure they survive into 2021 and beyond. Faced with the financial impact caused by lost profits and now, the return of their workforce from furlough, access to financial support is imperative.

After the nationwide lockdown was ordered, we saw the government demonstrate its commitment to helping SMEs overcome the crisis, with support packages swiftly rolled out – including the Coronavirus Business Interruption Loan Scheme (CBILS) and the subsequent Bounce Back Loan Scheme (BBLS). 

To date, over one million UK businesses have benefitted from nearly £43 billion in government-guaranteed loans to support their cash flows and avoid collapse during the long period of no-trading. And now, by being part of the CBILS ourselves, we’re hoping to contribute to this figure, enabling Britain’s businesses to overcome the financial barriers of Coronavirus to flourish and accomplish their goals. 

However, while the British Business Bank continues to approve lenders under its schemes to provide businesses with the finance they need, time is running out for small businesses who need the extra support, and this is where fintech has a crucial role to play.

As the coronavirus pandemic continues to intensify, and businesses previously deemed healthy struggle to survive, the need for the adoption of new technology has never been more apparent. 

Business owners struggling with cash flow challenges must be able to access finance instantly.  It is through events such as this that we can shift the narrative from lenders funding small deals in a few hours to funding large deals in a matter of minutes. 

Coronavirus has helped us identify who the real fintech players are, and looking ahead, we will begin to see which lenders can provide financial support to SMEs when they need it most. Thanks to investments made by fintechs in AI and automated underwriting, businesses get speedy, accurate decisions and this will no doubt be a precious lifeline to thousands of struggling SMEs.

At Nucleus, we’ve invested significantly in technology over the last 18 months, which will allow us to process CBILS applications and deliver funds to businesses within hours, at a time when traditional banks and other alternative lenders are struggling to keep up.