Further Covid-19 support announced by the government

Chancellor Rishi Sunak has announced further financial support from the government to help businesses and individuals that have been negatively affected by Covid-19.

He introduced the government’s Winter Economy Plan including a new Job Support Scheme to replace the existing furlough scheme, as well as tax cuts and deferrals. The Chancellor also announced an extension to the application deadline for the Coronavirus Business Interruption Loan Scheme (CBILS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS), the Bounce Back Loan Scheme (BBLS) and the Future Fund.

Here are the key points from the announcement:

If you need any help understanding what these changes could mean for your business, please get in touch.

We will update our advice and guidance as more detail is provided on the support announced, please keep an eye on our news & insights page or follow us on LinkedIn for the latest updates.

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Coronavirus Business Interruption Loan Scheme (CBILS)

Many travel businesses have taken advantage of the Coronavirus Business Interruption Loan Scheme (CBILS) announced by the government in March to support companies that are losing revenue, and seeing their cashflow disrupted, as a result of the COVID-19 outbreak. If you are still considering using the scheme, there isn’t long left to apply. Unless there are any further announcements, the scheme is due to close to new applications on 30 September.

If you have already applied for CBILS but were unsuccessful due to being classed as an ‘undertaking in difficulty’, you may wish to consider reapplying. Previously, ‘undertakings in difficulty’ were unable to access the scheme because of EU rules but this has now changed, and businesses in this category which have fewer than 50 employees and a turnover of less than £9 million can now apply. For more information, please see Gov.uk.

If you are planning on applying, please be aware that lenders may have specific requirements. Below are the loan conditions provided by some participating, non-high street banks. It is not a complete list, so we recommend that you contact your preferred lender directly to understand their requirements, or please get in touch if you need any help.

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Are trust accounts the future of financial protection?

The Covid-19 pandemic has raised the profile of trust accounts, with customers, operators and media proclaiming them to be the solution to the challenges experienced by package organisers in fulfilling refunds. However, the reality is far more nuanced.

Here, we have examined the advantages and disadvantages of choosing a trust account to financially protect your customer’s monies.

Table of advantages and disadvantages of trust accounts

Whether trust accounts are the future of financial protection for travel businesses remains to be seen, however, for some they can be an effective solution. If you are unsure which type of financial protection is best for your travel business, please get in touch. We’d be happy to provide further information and help you make the right decision.

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Refund Credit Notes – updated guidance from the CAA

The government has confirmed that Refund Credit Notes offered against ATOL protected bookings are financially protected. In this document, we highlight eight key points from the CAA’s updated guidance, including exactly what information you need for your Refund Credit Notes.

The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

A bumpy road to recovery for the travel industry post Covid-19

It’s positive to see there are some early signs of recovery for the travel industry after some challenging months due to Covid-19. However, we know it’s not going to be an easy road to bounce back and there’s a bumpy road ahead. We’ve put together some key dates to keep in mind over the next few months, that could impact the recovery.

Key dates for the travel industry

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Further changes to the furlough scheme – announced 12 June 2020

The government has issued new guidance outlining what the furlough scheme will look like from 1 July onwards. If you have furloughed employees there are a few things you need to consider. Some of the updated information is complex so we’ve pulled out the key changes to help ensure you’re ready for the new scheme.

We also have further details on the scheme here, if you have furloughed employees we recommend looking at the information on this page too.

Changes to the furlough scheme – announced 29 May 2020

Last week, further details on the furlough scheme were announced. Here’s a rundown of the key points:

        • From 1 August 2020, employers will have to pay National Insurance contributions and pension contributions
        • From 1 September 2020, the government will only reimburse 70% of an employee’s salary (up to a maximum of £2,190). Employers are required to contribute 10%
        • From 1 October 2020, the government will only reimburse 60% of an employee’s salary (up to a maximum of £1,875). Employers are required to contribute 20%

Furlough infographic

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

The impact of the Covid-19 crisis on your cash flow

Conversations during the Covid-19 pandemic have primarily been about the preservation of cash with a particular focus on reducing cash outflows in the short term, and increasing cash by utilising government assistance such as CBILS or the bounce back loan scheme.

When analysing cash, understandably most people have been focused on the very short term. The consequences of some of these actions are unlikely to be seen this year and with what appears to be some very early signs of borders preparing to open, if you haven’t already you should start to look further ahead.

Cash flow has in the past been inherently positive for most travel businesses and so forecasting hasn’t always been at the forefront for finance teams, but moving forward it should be a regular feature and even with the uncertainty that still exists, it’s important to start to now.

To start your thinking around this, here we’ve highlighted a few areas to consider. 

 

Chargebacks and Section 75 – guidance for the travel industry

During the current Covid-19 pandemic, many customers are choosing to seek a refund for their cancelled holiday via a chargeback or Section 75 of the Consumer Credit Act 1974, claim. There are however many reasons why you should be defending these claims. Here we explain the difference between the two types of claim and provide some top tips on how to challenge a chargeback.

Chargeback infographic

If you would like more information or a copy of a template letter please get in touch and we’ll be more than happy to help.

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Preparing to bounce back from the Covid-19 crisis

We all need to ask some searching questions about the long term impacts on our business models. We’ve put a together a few for you to start thinking about below, to help ensure you are ready for the bounce back. 

Bounce back matrix

The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Bounce Back Loan Scheme (BBLS) – updated on 4 May 2020

On 27 April, the government announced a Bounce Back Loan Scheme for small and medium-sized businesses based in the UK, who have been negatively affected by coronavirus. This could be a potential lifeline for some travel companies as the government has said the cash will be accessible within days of having your application approved. Now that the scheme has been launched, we have pulled together the key facts about the loan to help you decided whether to apply.

Bounce Back Loan Infographic

SMEs can borrow between £2,000 to £50,000 and the loan will be 100% guaranteed by government. We understand that companies won’t be charged any fees or interest, the loan terms will be up to six years with no repayments needing to be made in the first 12 months, and we expect there to be a low interest rate for the remaining period.

The loans will be delivered through accredited lenders however it is worth noting that if you have already been accepted for a CBILS loan, you aren’t able to also apply for this. If you already have a CBILS loan of up to £50,000 then you can transfer to a Bounce Back Loan by 4 November. To do this, please get in touch with your lender.

Banks, insurers and reinsurers are unable to apply however insurance brokers are eligible. Public sector bodies and state-funded primary and secondary schools also can’t apply, neither can any grant-funded, further-education establishments. You can only apply if your business was not an, ‘undertaking in difficulty’ on 31 December 2019.

How to apply – please speak to your lender who will provide you with an application form.

If you have any questions, feel free to get in touch. 


The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

The role of travel insurance during the Covid-19 crisis

Many insurers have now pulled their travel products from the market. What does this mean for consumers and the industry?

If a customer is unable to travel due to Covid-19, there is huge confusion around who they should approach for a refund. Should the customer go to the tour operator, insurance company, or credit card provider? Currently, there is no clear answer here, however one consideration is that the customer should try and claim through their insurance provider first, and if this is rejected they can go to the tour operator or agent for a Refund Credit Note or a cash refund. This would help to alleviate the issue of customers successfully claiming on their insurance and then going to the tour operator who also pays out, therefore receiving a refund twice. 

What will the travel insurance landscape look like in the future?

If insurers don’t provide cover under the existing policies, the government may have to get involved to confirm what underwriters should or shouldn’t be covering. Currently, the risk to the underwriters is unclear as this is an unprecedented situation and in the future, it may be that new policies are written to cover pandemics, but this will likely affect the price. Having said this, we expect that there will be a surge in customers wanting to insure their trips post Covid-19 and would be happy paying a premium price to give themselves that extra reassurance. There is an opportunity here for tour operators and travel agents who have their own insurance products. At the moment, there are a few travel companies that sell insurance either for business disruption or disruption to the destination. However, we have seen mixed success for claims for disruption due to Covid-19, being approved. When speaking to your customers about insurance, ensure they fully understand what is covered by the policy and what restrictions may be in place. 

Going forward, the overarching theme is that any travel insurance policies that are available need to be very clear about what is covered, to make the claims process easier. However, this does come at a cost, and we may see premiums going up.

Chargebacks

Visa and Mastercard have both provided guidance on chargebacks, which is an ongoing issue. Visa has gone further than Mastercard, to say that if a travel company cancels a customer’s booking due to Covid-19 then a chargeback can’t be made. However, from what we’re seeing, this isn’t feeding through to merchant acquirers and they are still processing chargebacks. If you are receiving chargebacks, especially through Visa, you should be challenging them. 

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The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch. 

Making a claim for furloughed employees: practical tips

The job retention scheme is now live and you’re able to make your claims for furloughed employees. In this video Adam Pennyfather talks through some first-hand, practical tips to help make the process easier.

Adam discusses the Government gateway ID, what information you’ll need and how to fill out the forms, as well as providing some guidance on turnaround time.

The COVID-19 crisis is rapidly evolving and the Government’s response and the details of support on offer are continuously changing. We’ll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn. If you have any questions in the meantime, please get in touch.

CBILS part 2: recent developments

In this second part of our CBILS video series,  Adam Pennyfather gives an update on the scheme now that it has been running for a few weeks. He takes a look at the following areas:

Criteria | Security | Information required | Indicative rates | Timing of applications 

The COVID-19 crisis is rapidly evolving and the Government's response and the details of support on offer are continuously changing. We'll be updating our posts regularly to ensure our analysis and advice remains as accurate and useful as possible. To receive the very latest information as we release it follow us on LinkedIn.  If you have any questions in the meantime, please get in touch.