Covid-19 business news update 21st April 2020.

21st April 2020.

James Salmon, Operations Director.

During the Covid-19 outbreak we will continue to share (as we can) the business news stories we have seen that we think will affect our members and readers. The news stories you might have missed that might have an impact on SMEs and those that sell on credit.


Equity markets kicked off the week yesterday with a mixed session, as optimism surrounding the easing lockdown restrictions was balanced out by a heavy drop in oil prices.

The positive news came out of Germany, where Europe’s largest economy took its first steps back towards normal life – announcing that the majority of shops smaller than 800 square metres would be allowed open to the public – signalling the first wave of easing restrictions introduced in the last month.

The negative news came of out the US where West Texas Intermediate oil prices tumbled to their lowest level in more than two decades, dropping towards $10 per barrel. The near-40% decline was a result of a crash in demand triggered by Covid-19 and warnings suggesting that storage could fill up in a matter of weeks.

Stocks in Europe battled between positive and negative territory, with the FTSE 100 eventually finishing up 25 points at 5,812.

UK urged to follow Denmark on tax haven bailout restriction
Denmark has told companies registered in tax havens that they will not be eligible for bailout funds to help them through the coronavirus pandemic.

Paul Monaghan, chief executive of Fair Tax Mark, praised the move but said the plan is limited by EU state aid law, mooting instead a system that would see companies that accept bailouts sign up to a set of binding fair tax principles.

With Sir Richard Branson facing criticism after asking the UK government to bail out Virgin Atlantic despite not personally paying tax here, the Independent says Denmark’s restrictions have prompted debate on if the UK should follow suit.

Three-in-four want post-coronavirus tax cuts
A poll by Survation and the Adam Smith Institute shows that almost three quarters of people believe tax cuts are needed to reboot the economy after the coronavirus crisis, with 72% of respondents calling for a reduction in taxes to “try and increase economic growth and jobs”.

Among respondents aged 18-44, 44% “strongly supported” lower taxes after the coronavirus, compared to 33% of those 65 or older.

Adam Smith Institute deputy director Matt Kilcoyne said that people “know that our lockdown is having a huge impact on our economy … they want an economic recovery and exit plan that includes tax cuts.”

Branson seeks taxpayer support
Sir Richard Branson has asked the UK government to bail out Virgin Atlantic, with some critics arguing that the billionaire should use a slice of his estimated £4.7bn fortune to support the airline.

There have also been questions over his decision to seek financial assistance from the taxpayer when he has paid no personal income tax in the UK since moving to the tax-free British Virgin Islands 14 years ago.

The High Pay Centre think-tank said it was “wrong” to inject taxpayers’ money into “companies who’ve done all they can to avoid paying tax in UK”.

Sir Richard insists that the £500m required would be a commercial loan and repaid, insisting “it wouldn’t be free money”.

Meanwhile, Virgin Australia is reportedly on the cusp of entering voluntary administration, with Deloitte lined up to act as an administrator.

Furloughing tops 1m on first day
The Government’s online application system for furloughing employees has launched, with huge numbers of employers expected to apply for inclusion in the scheme under which 80% of the wages of staff temporarily laid off as a result of the coronavirus pandemic will be paid, up to a maximum of £2,500 a month.

Chancellor Rishi Sunak, who last week extended the furlough scheme until the end of June, announced that more than 140,000 companies employing a total of a million workers applied to the scheme on its first day of operation – with 67,000 claims in the first 30 minutes.

The Chancellor said getting the Coronavirus Job Retention Scheme System up and running was a “remarkable story of public service”, noting that thousands of HMRC staff had either worked overtime or come out of retirement to assist in delivery of the initiative. The Revenue has deployed 9,500 staff to deal with queries.

Chancellor rejects calls to underwrite 100%
Chancellor Rishi Sunak has resisted calls for the taxpayer to underwrite 100% of loans designed to support small businesses being hit by the COVID-19 pandemic. Despite Bank of England governor Andrew Bailey saying a total guarantee on loans of up to £25,000 would help to unlock credit and former chancellors Sajid Javid and George Osborne offering similar sentiment, Mr Sunak said he was “not persuaded” that a total state guarantee was the way to go.

Despite some commentators voicing concern over whether the Coronavirus Business Interruption Loans Scheme – which provides an 80% guarantee on loans to small companies – is getting enough money to firms who need it, Mr Sunak insisted that the British government’s economic response was already “more significant than almost any other developed country”.

Government announces start-up support
The Treasury has announced a new £500m loan scheme for high-growth start-ups, with this coming alongside £750m in grants to small and medium sized research and development businesses. The package includes investment for high-growth companies, which will offer cash loans of between £125,000 and £5m, with private investors at least matching the Government’s commitment.

BoE deputy governor: 35% GDP fall not unrealistic
Bank of England deputy governor Ben Broadbent has said the economy could shrink by as much as 35% in the second quarter. Echoing comments made by BoE governor Andrew Bailey who last week said he didn’t see “anything implausible” in a scenario set out by the Office for Budget Responsibility where GDP drops by a third, Mr Broadbent said such an occurrence is not “unrealistic”.

The deputy governor for monetary policy said the BoE cannot be sure if the economy will see “scarring” or experience a quick rebound. On scarring, he said “the entire thrust of public policy as I see it is directed towards minimising those effects.”

He also said monetary financing, when a central bank directly funds government spending, is not taking place as the BoE is not being forced to support spending

UK Employment
UK Employment was at a record high in the three months to February, before the effects of the coronavirus lockdown started to hit the economy. Official figures showed 76.6% of people aged 16 to 64 were in paid work, up from 76.4% in the previous quarter.

Unemployment was estimated at 4%, slightly higher than the previous quarter. Pay in February continued to grow faster than inflation.

Negative Oil
Monday was an historic day for the oil market: Crude crashed into negative territory for the first time ever, signaling the extreme disconnect between supply and demand as storage tanks brim to capacity and the coronavirus-led economic slowdown pushes demand to a standstill.

Oil Prices hobbled back into positive territory on Tuesday after sinking below $0 for the first time ever, but international benchmark Brent dipped as the global coronavirus crisis severely reduces demand for crude.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

25 excuses for late payment and how to get around them.

Read our Cash Flow Advice

Read about our overdue account recovery service

Read our blog – What is credit management?

Read our blog – How to select a debt collection agency

20 ways to avoid identity theft

see our blog – 15 steps to avoid invoice fraud

Overcoming 5 common reasons for disputed invoices

As insolvencies rise, could you spot these warning signs in your customers?

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections