Two-thirds of SMEs polled have applied for Government schemes to help navigate COVID-19 crisis, reveals survey
14th May 2020 12:29 - Business Support
Two-thirds of SMEs polled have applied for government schemes to help navigate COVID-19 crisis: A survey of accountants working for small and medium business across the UK has revealed that 65% have turned to government schemes to aid cash flow due to the disruption caused by COVID-19.
The survey by The Institute of Chartered Accountants in England and Wales (ICAEW) questioned 517 members holding senior positions within SMEs, to learn more about how companies are responding to the crisis.
The survey found that 65% have cut discretionary spending, while many (38%) have reduced salaries and bonuses, as well as fixed costs (34%). Three in ten (30%) have put staff on paid leave, funded by their company, with a fifth reducing staff hours (21%).
At the time of the survey ( 30th April - 5th May), 16% reported changing their business model to navigate the challenging waters. Just 11% reported making permanent redundancies so far.
The survey found that many businesses have turned to Government support to help ensure their survival, with 92% saying their company has applied for the Coronavirus Job Retention Scheme (CJRS). Three-quarters have already received funds following their application.
Nine out of 10 (92%) also reported applying for coronavirus business support grants for small businesses, retail, hospitality and leisure businesses. Other measures taken by SMEs include business rates holidays (91%), deferral of VAT payments (87%) and using the HMRC Time to Pay scheme (70%).
The research also asked respondents about business loans, with two-thirds (66%) revealing they have applied for a Coronavirus Business Interruption Loan Scheme (CBILS). However, just a fifth (20%) at the time of the survey had received any money from this scheme. Two-fifths said they have applied for a Coronavirus Large Business Interruption Loan scheme, and 17% a Bounce Back loan (both launched on May 4).
In terms of seeing their way through the crisis, 78% of SMEs are using their reserves, while almost half (49%) are deferring taxes, and 47% generating capital through 'business as usual' activities, however almost a quarter expect to be out of cash by July. Almost three-quarters (73%) said they have enough cash for at least three months.
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