Bounce-back loan losses

[Protagoras]

So, it seems that loans were written totalling £47Bn, with an estimated fraud / error rate of c.8%.
(Source: https://www.bbc.co.uk/news/uk-64879444)

Presumably defaults would be on top of this.

So that's roughly £3.7Bn of tax payer losses. Who ever would have guessed

Just as well there's all that additional tax revenue from off-payroll, eh ?

[ladymuck]

There's a shocker.

One could always argue that the defaults are the fault of IR35 - without the recent changes, more small businesses would have remained viable and therefore able to repay their loans.

[SueEllen]

The government is being predicted to change the pension allowances to get people back to work. Problem is final salary pensions have their own rules and the cohort who have retired will be most of the people on them.

[Zigenare]

So, it seems that loans were written totalling £47Bn, with an estimated fraud / error rate of c.8%.
(Source: https://www.bbc.co.uk/news/uk-64879444)

Presumably defaults would be on top of this.

So that's roughly £3.7Bn of tax payer losses. Who ever would have guessed

Just as well there's all that additional tax revenue from off-payroll, eh ?

A flawed system that in some cases was exploited by a criminal element. Find 'em, bankrupt them, chuck 'em in gaol for fraud.

[SueEllen]

A flawed system that in some cases was exploited by a criminal element. Find 'em, bankrupt them, chuck 'em in gaol for fraud.

No space in jail.

Better to go after their assets including those of near relations/partners if they cannot prove they were gained through legit means.

[AtW]

90% of these loans will be lost

[vetran]

So no evidence of know your customer, looks like the banks lose their cash?

[ladymuck]

So no evidence of know your customer, looks like the banks lose their cash?

I think they were under orders to do minimal checks because HMG was backing it and wanted to be seen to be helping.

The banks won't lose anything. It was risk free to them.

[Protagoras]

... looks like the banks lose their cash?

The government guarantees 100% of the loan and there won’t be any fees or interest to pay for the first 12 months. After 12 months the interest rate will be 2.5% a year.

https://www.gov.uk/guidance/apply-fo...unce-back-loan

[AtW]

The banks won't lose anything. It was risk free to them.

Not risk free - they agreed to pursue these debts in the same way they’d pursue their own loans, so extra costs + rep damage of taking lots of firms to court