Over the weekend the WCDAI committee received unsettling news. One of our members had received disturbing correspondence from a lender. Our member, who is in business for over forty years, runs a viable operation without any credit problems, but has spent the weekend in fear of losing everything. This all happened when the member selected an incorrect option when applying for additional three month loan repayment break from the Bank of Ireland . When asked in the application “are you concerned that you may experience longer-term financial pressure and you would you like to explore additional supports to help pay your Credit Facilities”, they answered honestly and ticked the box. Just to be clear, the member in question has been a customer of BOI for almost 50 years and has never missed a payment on any loans from the lender.
Our member believes, that because of their uncertainly about business prospects later this year and international travel restrictions still in place, it moved the BOI to refer the members loan to their Collections Department (WCDAI SME member BOI collection letters)
Have a look at the letter in the link above. Can you imagine receiving something similar and the stress of having to deal with this as well as trying to keep your business viable and your mortgage paid during the current challenge? Been told by Government to use and avail of the loan payment breaks in order to protect our business and see out this difficult time and then the lender states that your account has gone into arrears for more than 15 days because you used the payment break which the Government have said all along was a support for SMEs.
The anguish alone of reading a letter like this with so much uncertainty and zero guidance as to when international travel will resume is frightening.
Just recently, Holly Cairns TD (Social Democrats) asked the Minister for Finance if he will assist in securing an extension for a moratorium on business debt for businesses that are unlikely to see a recovery until 2021 at the earliest. The Minister’s response was that he had no function in the commercial decisions made by banks. “I would urge anyone who may be worried about the impact of COVID-19 on their ability to repay their loans to make contact with their bank and discuss their options,” he said.
Paschal Donohoe went on to say that the banks were helping business customers impacted by COVID-19 and the Banking and Payments Federation Ireland (BPFI) announced their intention to extend these payment breaks to six months for customers that require it.
So come the end of the six month period when business travel and tourism will still not have returned to pre-pandemic levels, how are operators supposed to pay loans if they don’t have an income? Can we all be expecting similar letters in the post come October? And what is the new Government going to do about this?
The WCDAI needs urgent action from the Government to support us as we try to navigate our way out of this pandemic so that our viable Chauffeur drive and Coach tourism businesses will be able to return to operate for 2021. We are in unprecedented times, we need unprecedented action. And we need it now.
