Bank of England Governor urges faster lending to businesses
Banks should speed up lending to small and medium-sized businesses to lessen the impact of the coronavirus outbreak, Bank of England governor Andrew Bailey has suggested.
The Office for Budget Responsibility said unemployment could hit 3.4 million in a forecast from earlier this week, leaving around one in 10 of the working population without a job, while the UK economy could fall off a cliff edge.
The fiscal watchdog warned Covid-19 could lead to Britain's economy shrinking by up to 35% between April and June, with Mr Bailey telling reporters the figure was not "implausible".
The BoE has lent £7.6 billion to large firms, the deputy governor Sam Woods said on Wednesday, as more corporate giants have sought support to stay afloat through the coronavirus crisis.
In addition, more than £1.1 billion of loans have been handed out to smaller UK firms as part of the Coronavirus Business Interruption Loan Scheme (CBILS).
Mr Bailey said the Bank was eager to avoid "scarring" on the economy from Covid-19, adding that support for struggling companies would speed up recovery and prevent long term damage.
"(This) does have to be tackled otherwise we will destroy people's livelihoods and get the scarring that I was just talking about", he said.
And when asked about the CBILS and issues about a significant volume of applications, he added: "From an operational point of view, I've talked to banks a number of times. I've made it very clear to them.
"They're under no illusions that they've got to get on with this."Published: by Radio NewsHub