DMA calls for banks to rethink approach to coronavirus loan scheme


The DMA has called for banks to remove the personal guarantees from the CBIL loan scheme, to ensure the UK’s SME community can survive

Loan scheme

The UK Government’s Coronavirus Business Interruption Loan (CBIL) Scheme was welcomed by many businesses around the UK when it was announced.

These loans could be found all over the world. The wholesale mortgage loans scheme is intended to help small- to medium-sized businesses to secure their cash flow during these challenging times, with loans of up to 5 million with 80% guaranteed by the government.

Industry concerns

However, dozens of Data & Marketing Association (DMA) member organisations have expressed concerns about their experiences with banks when applying for a CBIL.

In fact, just one business has spoken of a positive experience with the scheme, while many more were shocked by the personal guarantees and interest rates they are being asked to agree to.

Indeed, many member organisations the DMA has spoken with shared correspondence with leading banks – including Barclays, HSBC, and Lloyds – asking for personal guarantees.

“When the CBIL scheme was first announced, many of our member organisations across the UK were hopeful”, Chris Combemale, CEO of the DMA, said.

“They believed, like us, that the scheme would provide the essential cash flow required to survive the current crisis.

“The businesses we’ve spoken to expect the 80% guarantee to mean just that. For instance, a loan of 100,000 would have 80% guaranteed by the government without the small business owner needing to guarantee the loan personally.

“However, that doesn’t appear to be how many banks are implementing the scheme.”


Below is an extract from the application form to the CBIL Scheme from Lloyds, which clearly indicates that the full liability would be owed by the business owner and recovered from them personally.

This would be the case even if the business entered insolvency proceedings.


The DMA is calling on the UK Government and major banks to take immediate action, clarifying these key issues for the businesses.

Combemale continued: “None of the SME member businesses that we’ve spoken to would be able to accept a loan on the terms banks are currently offering. Instead, many would be forced to choose insolvency, leading to the loss of tens of thousands of jobs across the UK’s data and marketing industry.

We are calling on banks and the UK Government to see sense and work collectively to ensure that this does not happen by removing the need for SME owners to provide personal guarantees for these loans.”

Challenging time

The DMA appreciates the unprecedented support the government has put in place during this challenging time for people across the UK.

It’s also important to recognise that some banks have not been asking for personal guarantees and that all the banks are doing a huge amount to help customers – through mortgage holidays and help around card fees. A handful of banks have even recommended that homeowners contact remortgage brokers to see if they can get a better rate that could potentially save themselves hundreds of pounds.

That said, the DMA is calling strongly for the banks to remove the personal guarantees related to the CBIL scheme, to ensure the UK’s thriving SME community can survive this crisis too.