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COVID-19 – Latest Economic Updates 20th March 2020

As the country continues to widely adopt social distancing and, where possible, working from home, we want to assure you that we are keeping in touch and maintaining our usual levels of service to you.

Yesterday’s press conference focused on the measures being put in place to tackle the virus, including the start of clinical trials and vaccine trials. We expect to hear today from Rishi Sunak on Government plans to support workers with new protections for jobs and wages and other initiatives.

We will continue to review updates and send you the information that we think is of most value to you and as ever, please do get in touch with the team at Rayner Essex here if you have any immediate questions.

 

Historic Lowest Interest Rate 0.1%

The Governor of the Bank of England, Andrew Bailey, cut interest rates to an all time historical low of 0.1%, they  haven’t been this low in the more than 300 year old history of the bank. Earlier this week the bank unveiled details of a scheme to buy debt from large distressed companies called the Covid-19 Corporate Financing Facilty, more details in the links below:

https://www.gov.uk/government/publications/launch-of-covid-19-corporate-financing-facility-ccff
https://www.gov.uk/government/publications/contingent-liability-arising-from-the-covid-19-corporate-financing-facility

On 11th March The Bank of England launched a Term Funding Scheme with additional incentives for SMEs to offer four-year funding at or very close to Bank Rate. Additional funding will be available for banks that increase lending, especially to small and medium sized enterprises (SMEs). You can read the market notice here

https://www.bankofengland.co.uk/markets/market-notices/2020/term-funding-scheme-market-notice-mar-2020v

 

COVID-19 – Business Rates Relief, Expanded Retail Discount

There are more types of businesses than you might think that qualify for the expanded relief for retailers. The guidance in the attached link outlines who can benefit. Please note this guidance is for local authorities and once we are provided with more details as to how businesses can claim we will be passing this on to you.

https://rayneressex.com/content/uploads/2020/03/Business-Rates-Expanded-Discount-Coronavirus.pdf

 

Mortgage Payment Holidays

In our last update we touched on mortgage payment relief and Rishi Sunak’s promise of ‘payment holidays’ of up to three months for those households adversely affected by COVID-19. Those in difficulty will be fast tracked and offered at least a three month pause in their payments whilst they get back on their feet. After three months the lender will asses your circumstances and agree on a way to make up deferred payments. The unpaid interest will still be recovered later, but individual credit ratings will not be affected. This article from The Guardian is useful. Please note the banks are still working on the technical details and when we know more we will share it with you.

https://www.theguardian.com/money/2020/mar/17/uk-banks-set-out-details-of-covid-19-mortgage-holidays