Chancellor Rishi Sunak wants the new scheme to unblock a backlog of applications.
Small firms are to get access to 100% taxpayer-backed loans after they raised concerns about slow access to existing coronavirus rescue schemes.
It aims to unlock a backlog of credit checks by banks amid fears many small firms could fold before getting loans.The loan terms mean that no capital or interest repayments will be due for one year. Instead, the government will pay the interest for the first 12 months. Mr Sunak had come under pressure to underwrite all loans, not just those up to £50,000. But he told the Commons that he was not prepared to do this as he needed to balance the risk to the taxpayer with the needs of small businesses.
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