The coronavirus interruption loan scheme (CBILS) isn’t working as planned.

So Rishi Sunak has made amendments to the scheme, announcing them 3rd April.

If you have applied unsuccessfully, go back to the bank again. But wait a few days, as you’ll see below.

Only around £90m of CBIL loans have been approved for 1,000 small businesses so far, despite 130,000 enquiries. Not good.

Why is this?

Number one is the Treasury’s failure to place restrictions on interest rates, meaning banks were offering CBILS loans with interest rates of up to 30% and demanding personal guarantees from before they would lend.

Rishi Sunak announced the following amendments (3rd April):

• Banks must. match the ‘commercial’ rate of interest to reflect the current low Bank of England interest rates. In other words, rates that companies can actually afford.
• A CBIL loan is no longer a last resort. Banks were trying to get businesses to find other forms of financing first and only give them a CBIL loan if they could get nothing else. Now businesses don’t have to prove they have no other avenue to go down.
• Banks are now banned from demanding personal guarantees for loans under £250,000. A great move.
• The government is amending its own process to speed up approvals for the scheme.
• According to the Rishi, the government “listened to the concerns of some larger businesses affected by COVID-19 and [will] continue to work with the financial services sector to ensure that the £330bn of government support, through loans and guarantees, reaches as many businesses in need as possible.”

He is expected to speak to the banks next week to review the scheme and “ensure everybody is playing their part”.

See more in our coronavirus survival guide